As the economy of the country continues to witness challenges due to the fluctuations in foreign exchange rate, insurance practitioners have said that the situation is having adverse effects on insurance business.
Managing Director of Universal Insurance Plc, Mr. Ben Ujoatuonu said that insurance is an international business as such the marine aspect of insurance business is being affected because importation is at its lowest ebb.
Ujoatuonu said, “Because of the problem of exchange rate, every insurance company is feeling the brunt in the hype in exchange rate and it has affected the marine aspect of our business. Of course every other person within the society is feeling the heat of the economic situation and because insurance business is not insulated, the insurance business will feel the heat as well.”
Also President of the Nigerian Council of Registered Insurance Brokers, Mr. Kayode Okunoren said that it is most disheartening that the value of the naira has continued to take a downward plunge against the dollar, pound sterling and other currencies, to the detriment of the nation’s economy.
Okunoren said, “The resultant effect of this is negative on the nation’s economic revival efforts. Aside from the possibility of stagnating industrial development and favourable trade, the situation is already causing increasing inflationary rate that is affecting the common man in the street. The mono economy has left the country helpless, considering also the continuous downward slide in the price of crude oil in the international market, upstaging the budgetary anticipations of government. Definitely, the insurance industry is not insulated from these grievous indices of economic recession. It is a tough time we must all admit.
“As a critical stakeholder in the nation’s economy, it is our take that the present situation serves as a good avenue for government to begin to pay more emphasis to diversification of the nation’s economic mainstay from oil, as we have had till now. There must be a re-tuning of the minds of Nigerians from rabid consumption of foreign goods and services at the expense of those produced locally. Also, the penchant for luxuries has to be curtailed so as to preserve the nation’s available meager foreign monetary reserve for the essentials, rather than fritter them on irrelevances. It is definitely a period that calls for sacrifice on the part of all Nigerians, including the leadership, if the present crusade would achieve long lasting positive results. I whole heartedly align myself with the timeless wisdom that “to be successful as an individual or a nation, you must decide exactly what you want to accomplish, and then resolve to pay the price,” Okunoren said.