Tony Elumelu’s Heirs Holdings unveiled Heirs Insurance Limited on Tuesday
In November 2020, Tony Elumelu’s Heirs Holding officially received an operating license for a new Group insurance company – Heirs Insurance Limited and Heirs Life Assurance Limited (HLA) – from the National Insurance Commission (NAICOM).
An excited Chairman of Heirs Holding, billionaire Tony Elumelu had said the move “represents an important milestone of a long-term strategic journey in providing much needed, quality, & valuable financial services, to a broad demographic in Nigeria”.
“Insurance should not be a luxury, and just as we have democratized other sectors, we will democratize insurance – applying our tried & tested business philosophies,” Elumelu had said in a LinkedIn post.
On Tuesday, the Heirs Insurance Limited came alive to provide general insurance and life assurance services. Heirs Insurance and Heirs Life Assurance have a paid-up share capital of N10 billion and N8 billion respectively and are backed by leading reinsurers, providing a second layer of security for clients’ insurance portfolios, according to Elumelu.
Why this matters
The insurance industry in Nigeria is not in short supply of providers. What the industry contends with are shallow penetration and a worrying trust deficit. And if Heir Insurance Limited is going to make any dent, it’s task is cut out for it – getting more Nigerians to embrace and trust insurance services.
On that score, the major competition remains Nigeria’s religious houses who have been the largest underwriters so far.
Nigerian churches, which are in their thousands, provide the first and only form of insurance – both for property and life – that most Nigerians know. And they are minting cash – like tons of it – selling car stickers as auto insurance and olive oil for health insurance. So, if one must succeed in selling insurance in Nigeria, one must first get to figure out how to deal or work with the churches.
Beyond these, there are trust deficit issues in the industry. There are quite a few operators that are undercapitalized, and struggle to meet claim obligations. Yet, due to poor regulation and corruption, the arm of the law remains stunted to force a change.
But as Elumelu said in his post, we believe Heirs Insurance has “embarked on this journey to revolutionise the insurance space – deploying technology, customer understanding & operational excellence”. Best of luck with that, but are those enough to make a dent? We wait and see.