Management Of Insurance Companies In Nigeria: A Case Study Of UNIC Insurance Plc

Project and Seminar Material for Business Administration and Management BAM

Management Of Insurance Companies In Nigeria: A Case Study Of UNIC Insurance Plc


Abstract


This research work was aimed at determining the impact on management of insurance companies in Nigeria with particular reference to UNIC INSURANCE PLC

A structured questionnaire made up of a little combination of some dictatorship and open ended questions was developed and distributed to a total of 80 male and female employees of UNIC INSURANCE PLC.

The data collected were analyzed using percentages, mean and rank order. Based on the above major findings include;

  1. That the human and non-human resources available in the insurance company are not adequate.
  2. That UNIC INSURANCEPLC has not experienced any form of friend.
  3. Under interference and insanity of the job/position of supervisions affect the objetinty of their reports and recommendations.
  4. That non-implementation of previous reports affect the function of supervisors.

Based on these findings, the following efficiency and effectiveness in the management of insurance companies.

  1. That Insurance companies should use delegation as a supervisory strategy to be in professional touch with all the department in the insurance company.
  2. A programme of in-service education and training should be given to staff on regular basis to enable them get abreact with the changing demand of time him.
  3. Insurance companies should consistently organize seminars .Staff meeting, individual conferences, professional lectures and provision of office bulletins
  4. Staff safety and welfare packages must be adequately assured for proper continuity.

Table of Content


Preliminary Page(s)

  • Title
  • Declaration
  • Approval
  • Dedication
  • Acknowledgement
  • Abstract
  • Table of Content

Chapter One

Introduction

  • 1.1 Background of the study
  • 1.2 Statement of problems
  • 1.3 Purpose of the study
  • 1.4 Test of Hypothesis
  • 1.5 Significance of the study

Chapter Two

Review of Related Literature

  • 2.1 insurance company organization
  • 2.2 Under writing
  • 2.3 Theory of rating
  • 2.4 Premium rating in non-life insurance
  • 2.5 Premium change in life insurance
  • 2.6 Sources of insurance company fund
  • 2.7 The investment of insurance company fund
  • 2.8 Insurance company account
  • 2.9 Summary of the review literature

Chapter Three

Research Methodology

  • 3.1 Area of study
  • 3.2 Population
  • 3.3 Sample and sampling procedure
  • 3.4 Instrument for data collection
  • 3.5 Validation of research instrument
  • 3.6 Reliability of research instrument
  • 3.7 Administration of the research instrument
  • 3.8 Method of date analysis

Chapter Four

Data Presentation and Results

  • 4.1 Date presentation and analysis

Chapter Five

Discussion of Results

  • 5.1 Discussion of findings
  • 5.2 Conclusion
  • 5.3 Recommendation
  • 5.4 Limitation of study
  • Appendices

Chapter One


Introduction

1.1 Background of the Study

The management of an insurance company, like any other business outfit, has an aim or purpose to pay claim in return for payment of premium. The insurance company undertake numerous activities in their operation usually assessing the extent to which the risk presented in any respect departs from normal and if so, to what extent additional hazard can be mitigated at what rating consideration. A process known as premium rating is used to decide vohat price you should change to. The premium price should reflect the claims list and expenses associated with the contract but also include an allowance for the insurer profit margin, this allowance depends on the level of competition in the relevant insurance market.

Like every other business if the insurance companies want to increase the amount of business they undertake (at the right price) and attempt to do this involves different system since company differ in their degree of reliance on a direct sales force rather than using brokers and also in the amount they spend on advertising. Also insurance company cannot pay all claims out of revenuer received for premium and investment income, because the timing of these payments and receipts cannot be co-coordinated, they must therefore maintain a fund that can be used to pay claims, such funds are also necessary in the case claims are unexpectedly large. In many classes of insurance fund are accumulated carefully investment of these funds will allow insurers to earn interest income and make capital again.

More so, the insurers may be aware that certain potential claims payment may exceed his financial resources. He will therefore wish to pass on some of the liabilities for the claims to another insurer by buying insurance like other enterprise, insurers make payment to creditors (claims to insure commission agents) and receive money from debtor (such as premiums) They ought then compile accounts for internal management, shareholders and the taxation and supervisory authorities. A major problem with these is that insurers liabilities that the potential claims payments may not be know and must therefore be estimated. Insurance companies must pay co-corporate with tax value added tax and capital gain tax.


1.2 Statement of Problems

  1. Based on the fact that every successful company weather profit or non-profit oriented in Nigeria lies on its management.
  2. Secondly goes majority of Nigerians do not appreciate the role insurance industry pay in the economic development of this country.
  3. Another striking factor that off this research work is the fact that our people appear not to understand the impact insurance could have in national development.
  4. There is also the problem of non-challant attitude of most Nigerians in embracing the idea of insurance coverage as one of the veritable instrument for the national development in developing countries. It is therefore on the foregoing premise that this research work is necessary in the first instance.

1.3 Purpose of the Study

  1. To what extent does insurance in Nigeria helps in solving economic problems in building of the nation
  2. To what extent does the non-challant attitudes of some people affect nation development.
  3. To what extent does is the usefulness of insurance of the manage management; serve as a reference point for the self-help and self-reliance.
  4. To what extent has Government gone to curb the problems associated with insurance management as regards development?

1.4 Test of Hypothesis (Null)

In the course of the study (4) hypothesis were treated these include Hoi there is no significance benefits derived by common man from insurance fund and management. Ho2 There is no significant evidence to prove that some people have non-challant attitude towards insurance industries.

  • Ho3 There is no usefulness of insurance management as reference point for self-help and self-reliance.
  • Ho4 There are many identified problems associated with insurance management towards national development.

1.5 Significance of the Study

A work of the nature is not without significance or relevance to some people, group and companies alike. It is on this basis that the research outlined the following significance of the study.

  1. This study provides background for the enlightenment of the masses to understand the need for insuring reasons to insure, how to insure and so on.
  2. The study on insurance company management and practice in Nigeria entails giving detailed enlightened to the insuring and general public on how the insurance industries are being managed and practice.
  3. It is vital for the masses to know and understand some terminologies in insurance duties and responsibility of each department and staff in an insurance company.
  4. This research work will serve as a study to ascertain this process of assessing risk proposed for insurance and fixing proper premium rate, which is otherwise know as underwriting.
  5. Knowing how to re-insure which helps to reduce his ultimate liability warranties and condition of insuring also criteria of the risk accounts of the company.
  6. The study will assist in identifying various problems associated with insurance management towards national economy.
  7. It will at the same time save as a reference point to many itching to insure to encourage them and to help in knowing how to chose an insurance company of his choice.
  8. At the end of this research work, many people in our society will be able to correct their mistakes and ignominious approach towards insurance management and its importance towards improving living standard and other economic development in the nation.

Chapter Five


Discussion of Results

5.1 Discussion of Findings

In an attempt to study the technical managerial ability of insurance company in Nigeria using UNIC Insurance PLC Enugu Okpara Avenue, a case study. The following findings were made;

  1. It was found that the company’s earlier problems were boardroom politics and lack of sound technical competence. But this cankerworm was overcome when they had a sound and experience expatriate as the chairman and a competent gentleman as the Managing Director.
  2. The company’s claim settlement and technical competence can be rooted high compared to its competitors in the insurance industry they helped immensely in drawing more clients, which made the company growth rapidly.
  3. It was also discovered that having insurance products could help in drawing more clients. The company has more than ten insurance products.
  4. A greater percentage of the middle managements are not professionals.
  5. It was discovered that insurance awareness was lacking to the insuring populace. This needs to improve.
  6. In insurance business, you have to strive to be better than other insurance company by trying to pay up claim as and when due. From the reach, the researcher found out that the company is customer oriented because it is mindful of its competitors.
  7. It was also discovered that the external and internal relationship are quite cordial.
  8. The company is quite viable because of its sufficient capital base, which is very essential in insurance business.
Discussion of Results

The result of the researcher can be discussed as follows, that the company’s underwriters large quantity of insurance product namely life, motors, fire, burglary, workers compensation, group and personal accident, bond, fidelity guarantees and marine.

The management of UNIC Insurance PLC visa-vise other competitors are strongly recommendable. The researcher’s study shows that Clients, Brokers and Agents like to be associated with the company because of its expertise in insurance underwriting and prompt claims settlement. Underwriting can be seen as a major department in insurance industry. Underwriting is a process by which the insurance, on what conduction’s in what proportion and at what price. The underwrite insurance of the person, which considers the age, occupation, physical condition, medical list history of the individual. Underwriting also consists of motor insurance, fire insurance, theft insurance, liability insurance and so on.

The researcher also noted that the entire staffs of the company are not actually happy because of poor remuneration despite the fact that the company makes a lot of turn over at the day. This ugly situation is been handled by the in turned trade union. The researcher also found out that the company uses its internal training facility to upgrade the performances of its workforce.

Finally, the level of capital bases in insurance industry weighs knowing that every industry’s strength. It is quite essential because it helps in so many things like prompt claims settlements, which is what every client looks out for. The company in study seems to be doing well due to its strong capital base and forgo partnership, which based in London and culled commercial Union Assurance.


5.2 Conclusion

Claim settlement is the main thing in insurance business. Without prompt settlement of genuine claims insurance companies will loose its credibility.

Efforts have been mane by the researcher to review the management and practices of the insurance company in Nigeria and as not been designed for private, neither for federal government practice only, but like any other business organisation is for profit maximization. Premium rating and risk assessment as among the duties of the underwriters should be based according to the classes and subject matter of the insurance industries.

Effective and efficient management is necessary to determine the judgement of performance of the organisation to the general public and shareholders, whether to invest with the company or not.

Souring and investment of fund and accounting records of the company are to be maintained for the pursuance of objective and aims of the general organisation.

Sound underwriting could as well save the company from untold catastrophic lose.


5.3 Recommendations

The researcher wishes to acknowledge;

  1. The efforts of the management of UNIC Insurance PLC in providing sound underwriting and timely claims settlement to its numerous customers. This is a good marketing strategy, which should be maintained.
  2. However, there is room for improvement and in an attempt to provide solution to the problem identified by the researcher, therefore recommends as follows; In view of the fact that the company is a household name in insurance world, there is still need for her to create public awareness on the dos don’ts of insurance companies.
  3. The company should try as much as possible to erase the already negative impression the public had built against the insurance over the years.
  4. The insurance company in Nigeria should create a forum periodically whereby they can meet with the general public. The staff should also be properly trained on the roll of insurance to the populace.
  5. The company should continue to be customer oriented by paying adequate attention to its customers when the need arose.
  6. The company should monitor the activities of the touts and cooperative insurance companies that operate without license cooperate address and capital base. In case of loss they are nowhere to be found.
  7. For effective and efficient management of a typical insurance organisation, there is the need for consist of Boards of Director, Managing Directors, Deputy Managing Director Reinsurance, Underwriting Director, Life, Marine and other services.

In addition, the organisation should be departmentalised into different areas especially life, marine and claims which are specialized area.


5.4 Limitation of Study

5.4.1 Time:

This study was conducted under the time limit of the research’s academic program. As such time constraint was one of the obvious problems that face the researcher.

5.4.2 Finance:

The financial status of the researcher limited the number of respondent used for this study.

5.4.3 Work Schedules:

The exigency of duties among the respondents posed another limitation as the research found it difficult to call all of them together on one occasion.

5.4.4 Materials:

Lastly, our library lack adequate textbooks, journals and articles on insurance company in Nigeria. This made the researcher limit her study to the available.


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