The immediate President, Institute of Loss Adjusters of Nigeria, Mr. Darlington Mgbojikwe, speaks with NIKE POPOOLA on the relevance of loss adjusting profession in the insurance industry, and other related issues.
What do loss adjusters do in insurance?
The duties of loss adjusters include the inspection and investigation into the circumstances that led to a loss that an insurance policyholder incurred as a result of an unfortunate incident.
It is not necessarily limited to that. Upon completion of the preliminary enquiries, the adjuster will relate the outcome of these actions to the contract document in the insurance policy issued by an insurer in order to determine the extent of insurer’s liability under the stipulated terms and conditions.
What are the category of risks that loss adjusters assess?
As a matter of fact, loss adjusters investigate and assess all types of risks, inclusive of life, that are insured by an underwriting firm. These risks range from the basic covers like fire and burglary, to industrial and major risks such as marine and aviation claims.
However, the adjuster must have had the educational, professional qualifications that are supported by practical training for the acquisition of skills in the chosen class of insurance claims assessment. For example, the adjuster can have a bachelor’s degree in quantity surveying or civil engineering or professional qualification in insurance, and thereafter take up studies aimed at sitting for Institute of Loss Adjusters of Nigeria or Chartered Institute of Loss Adjusters (United Kingdom) professional examinations. It is recommended that prospective candidates should be in gainful employment of any of these organisations; an ILAN member firm; insurance firms, officers in charge of insurance matters in government and high profile private business establishments.
What is the level of development of loss adjusting business in the country?
The level can be said to be evolving; being that the major area of service is that we are intermediaries servicing the insurance industry. As you may be aware, the level of insurance penetration in Nigeria is below 10 per cent. Thus, the rapid development of insurance business will definitely improve the fortunes of the adjusting practitioners. The insurance industry regulator, National Insurance Commission, recently introduced some initiatives aimed at improving insurance awareness and by implication, the fortunes of Nigerian underwriters. These initiatives, in one way or the other, will rub on the fortunes of our businesses as adjusters. The governing council of the Institute of Loss Adjusters of Nigeria is working very hard towards improved educational standards and skill acquisition by organising training sessions for its members, in order to cope with challenges that are associated with the anticipated rapid growth of the industry.
Members of ILAN have keyed in and have already taken up the challenges of the local content policy of the Federal Government in the oil and gas industry. We are poised to take full advantage by the development of necessary human capital resources required to meet the associated challenges in this specialised field.
When huge losses occur in the country, do insurance companies invite local loss adjusters or prefer foreign loss adjusters to investigate such losses?
Insurance companies do invite local loss adjusters to handle huge losses whenever they occur in the country. There are cases where the huge risk is heavily reinsured overseas; the reinsurer may opt to, under the terms of reinsurance placement, appoint an overseas-based adjuster. However, under the existing laws, the overseas appointed adjuster must attend to the loss in conjunction with local adjusters that are either appointed or nominated.
There is no doubt that there are instances where local expertise may be inadequate and the need to get foreign specialists to handle such cases is required. It is expected that the local adjuster would acquire or technically benefit from the foreign based adjuster. No doubt, the term, technology transfer, is expected to arise from such joint appointment on high profile losses. In effect, underwriters’ decisions to invite foreign loss adjusters are, in most cases, dependent on the specialty of the key personnel in those adjusting firms rather than dependent on whether the adjusters are local or foreign based firms.
What major challenges do loss adjusters face?
The chief challenge is getting our youths interested in taking up career in this field. There is the opinion or belief that remunerations in loss adjusting do not match the time, efforts and risks associated with the job. Due to this factor, ILAN member firms regularly suffer very high staff turnovers, not only to competitors but unfortunately, to other professions. This challenge is being addressed and with improved earnings that will, hopefully, come our way soon, adjusting firms will be in a position to, at least, match the level of remuneration prevailing in the other sections of the industry.
The issues of improved scale of fees and settlement of our professional fees have, over the years, been areas of great concern to adjusters in Nigeria. ILAN council, over the years, is in regular discussions with underwriters, through their umbrella body, Nigeria Insurers Association, in this regard and hopefully, the outstanding issues will be amicably resolved soon.
What role will loss adjusters play in investigating the Dana Air crash when insurers begin claims settlement?
Let me first express my condolence to the families, friends and indeed, Nigerians on this tragedy. God will grant them the fortitude to bear these losses. As an operator and as a condition for the issuance of a licence by the aviation regulator in Nigeria, Dana Air must have in place an insurance cover for various liabilities arising from this accident. The basic covers that should be on the insurance policy are: there should be an aviation hull cover for the damaged aircraft; third party liabilities for the passengers and their respective luggage; third party liabilities for the landlords and residents of the affected buildings and other property.
The roles that adjusters will play include investigation of the cause of the accident and ensuring that insurers’ respective liabilities are determined under the terms and conditions of the policy as issued by insurers. It is not limited to that. If the liabilities arising from the accident are far in excess of what is covered under the policy, Dana Air will have to pay for those legal liabilities that are outside the scope of cover granted by their insurers.
How did you go into loss adjusting?
I started my career in an underwriting firm in 1978. I then switched over to loss adjusting where I felt I will be more relevant bearing in mind my science background in physics from the university. I also obtained a post graduate diploma in insurance and risk management studies to back it up. I attended various local and internal study courses, obtained professional qualifications; local and international, that enabled me to attain the height that I now occupy in loss adjusting and indeed, the insurance industry.
I must point out that it is absolutely necessary for an adjuster to be well grounded in insurance studies before starting a career as an adjuster. I liken this position to the fact that one cannot be a court judge if one were not a law graduate.
What was your biggest challenge when you were the President of ILAN?
On my election in 2007, I set out goals that I intended to achieve among which the biggest was to get ILAN Bill passed by the National Assembly. The bill went through all the necessary processes by members of the House Committee on Commerce, inclusive of the public hearing in July 2010. Unfortunately, the House Committee’s report was not presented in plenary before the dissolution of that assembly. Thus, we are expected to start the whole process afresh. As a matter of fact, we have already re-commenced the process and we cannot but hope and pray that the current House will pass it before the end of the current legislative period.
What will you consider as your biggest achievement during that period?
ILAN achieved most of the set objectives during my tenure. Personally, I consider the issue of all members of ILAN speaking with one voice during my tenure as the greatest achievement. There were several challenges inclusive of inappropriate pricing of our services and prompt settlement of our fees. We appreciated that our principals were faced with their own pricing issues and were not favourably disposed to completely sort out issues with them. I can tell you that with the foundation that was laid during my tenure, there is hope that all the outstanding issues will be sorted out soon.
What is your driving force?
The major thing that motivates me in life is the drive to excel and be the best in whatever I set my mind to do. With perseverance, I have recorded successes in reasonable targets set out for myself. That does not mean that it is rosy all the way.
What should young loss adjusters do to attain greatness?
My advice to them is that they should be patient and focused during their training period. Unfortunately, there is this craze for our colleagues to run or head small adjusting firms without being grounded in the profession. This has led to so many “one man band†firms whose growths are, most of the time, limited. I have always preached that there should be mergers so that synergy would take us to greater heights.
Source: Punch
