Despite the gloomy outlook of the Capital market occasioned by the consistent bearish trend, a call has been made on the Nigerian Investors to look the way of the Insurance Sector of the economy while making their investment decisions in these trying times.
While making the call recently at a business forum in Lagos, the Managing Director of Sovereign Trust Insurance Plc, Mr. Wale Onaolapo stated that the Insurance Sector is full of potentials and there is no better time than now for every discerning investor to invest in the Industry. In his words, “While we agree that we still have a couple of challenges to battle with in the Industry, you will all agree with me that the Industry has been greatly transformed after the last recapitalization exercise and the process is still on going”.
According to Onaolapo, Investors have however not taken full advantage of the potentials inherent in the Insurance sector even after the consolidation exercise basically because of the global financial crisis which has in some ways limited the spending and Investment powers of Individuals as well as corporate entities. He enjoined both Nigerian and foreign investors to latch on to the future financial destination in Nigeria and not to be discouraged by the present lull in the capital market.
He further stated that “insurance companies now have the capacities to underwrite big ticket businesses and can favourably compete with their peers in other climes”. The Claims paying ability has also been boosted. The recent policy on local content and the bill on compulsory insurance of public buildings are also favourable policies that will help grow the Industry and hence make it the toast of Investors in few years to come.
Wale Onaolapo reiterated that “there is no better time to invest in the industry than now by taking advantage of the generally low prices of stocks in the financial and insurance sector. The market will pick up some day very soon and at that time the Investment decisions that we make today will stand us out”.
Despite the biting Global financial melt down; Sovereign Trust Insurance Plc has been able to maintain its impressive performance. The financials in terms of the Gross premium and Profit have been on the upward swing. Returns to investors in terms of dividends, bonus issues and Capital appreciation over the years have also been impressive.