5 Reasons Nigerian Businesses Don’t Use Insurance

In Nigeria, most businesses don’t have insurance. Although insurance companies have been around since 1918, very few businesses use them.

A study by Intelpoint found that about 96.4% of businesses have no insurance at all. Let’s look at five main reasons why insurance isn’t popular among Nigerian business owners.

1. Lack of Awareness

A lot of business owners don’t understand insurance well. They don’t know how to start getting insurance or why it’s important. Even though insurance companies try to teach people about insurance, their efforts haven’t been very successful. Many business owners still don’t see the need for insurance or know how it could help them.

 2. High Cost of Premiums

Insurance costs a lot of money, and many small businesses in Nigeria can’t afford it. Most small businesses make less money than the lowest insurance price they would have to pay. This makes it hard for them to even think about buying insurance.

 3. Scarcity of Sales Agents

There aren’t enough people working to sell insurance. Many who start selling insurance quit within two years because they don’t make enough money, the job is tough, and they can’t meet their sales goals. This means there are fewer people available to explain insurance to potential customers, which makes it harder for businesses to learn about and buy insurance.

 4. Cultural and Religious Beliefs

Some people in Nigeria believe that their faith will protect them from bad things happening, so they think they don’t need insurance. These beliefs make them less interested in buying insurance because they don’t see it as something necessary.

5. Mistrust of the Insurance Industry

Many Nigerians don’t trust insurance companies. They think insurance doesn’t give them any real benefits and that it’s too complicated. They are worried they won’t get the help they need when they need it, even if they pay for insurance.