INTANGIBILITY OF INSURANCE POLICIES AS A SET BACK TO BETTER SERVICE DELIVERY IN NIGERIA

ABSTRACT

Intangibility of insurance policies as a setback to better service delivery in Nigeria is the topic in discussion. This is the modification of the insurance policies or companies’ ways of doing things over the years. This has taken the form of religiously repeating the same set of effectiveness as it is related to the needs of the customer. Chapter one of this project emphasizes mostly on the introduction of project which comprises of background of the study, scope and limitations of the study, definition of terms. These go further to explain the basis of this project. Chapter two of this project is centered on the review of the related literatures. Here the following points were emphasized on the need for intangibility, imperative, present failure update of new polices, principles of customer centered intangibility, marketing of the intangibility of insurance policies. Chapter three of this project as well contains the research methodology and design, which includes the methods of data collections, such as questionnaires, oral interview problem encountered. Chapter four of this project emphasized on the data presentation and analysis which includes the use of tables as well as other forms of data presentation methods. Finally chapter five contains the conclusion and recommendations based on the findings arrived at through this project specifically from chapter one to three. Lastly, the bibliography and copy of the drafted questionnaire. This whole idea of this intangibility is customer interrelated competency areas such as: strategy formation, education, training and communication, process improvement, assessment, measurement and feedback.

TABLE OF CONTENTS

Title page: …………………………………………………………………………………i

Approval Page: ……………………………………………………………………………ii

Dedication: ………………………………………………………………………………..iii

Acknowledgements: ……………………………………………………………………iv

Abstract: ……………………………………………………………………………………v

Table of Contents: ……………………………………………………………………..vi

CHAPTER ONE

• Background of study: ………………………………………………………..1
• Statement of problem: ………………………………………………………3
• Objectives of study: ………………………………………………………….4
• Research Questions : …………………………………………………………4
• Research Hypothesis: ………………………………………………………..5
• Significance of study: ………………………………………………………..5
• Limitation of the study:………………………………………………………6
• Definition of the Terms: …………………………………………………….8

References

CHAPTER TWO  

2.0   Review of related literature: …………………………………………….12

2.1   Overview of the Origin of Insurance: ………………………………..13

2.2   Nigeria insurance market: ………………………………………………..13

2.3   The need for Tangibility: ………………………………………………….14

2.4   The demand for insurance policies: …………………………………..16

2.5   Intangibility (An update of new policies): ………….………………18

2.6   Present failures: ……………………………………………………………..21

2.7   The intangibility imperative or importance: ………………………..22

2.8   Principle of customer centered intangibility: ……………………….24

2.9   Marketing of the Intangibility Insurance Polices: ………………..26

CHAPTER THREE

3.0   Research Methodology: ……………………………………………………29

3.1   Research Design:……………………………………………………………….

3.2   Population: …………………………………………………………………….29

3.3   Sampling size determination: …………………………………………..29

3.4   sources of Data: ……………………………………………………………….

3.5   Method of Data Collection: ………………………………………………30

3.5   Methods of Data Analysis: ………………………………………………30

3.6   Instrumentation: ……………………………………………………………33

CHAPTER FOUR

4.1   Presentation and Analysis: ……………………………………………….34

4.2   Test of Hypothesis: …………………………………………………………37

CHAPTER FIVE

5.1   Findings: ………………………………………………………………………..42

5.2   Conclusion: …………………………………………………………………….43

5.3   Recommendation: …………………………………………………………..44

Bibliography

Appendix

CHAPTER ONE

INTRODUCTION

1.1   BACKGROUND OF THE STUDY  

Despite the introduction of the Structural Adjustment programme (SAP) advocated by the federal government in July, 1986 to combat and resolve the economic crisis that have lingered since 1980, most companies especially the manufacturing companies have shown bad performances low capacity utilization has led to the retrenchment of thousands of workers nationwide since the last quarter of 1993.

Obviously, the insurance industry cannot be spared from reacting to sudden change in the economy which is difficult to predict. There is direct positive relationship between the performance of the economy and that of the insurance industry. The industry must take the appropriate actions to relieve the fears and concerns of the watchers and viewers of the industry. It can also adopt effective work processes or systems, to meet the expectations of the growing population of the insured. Over the years, the insurance services (product) way of performance has taken the form of religiously repeating has same set of tasks over and over again without considering effectiveness as it relates to the needs of customer. More or less, the performance of the insurance services has been that of routing and stereotyped activity as they handed down by the pioneers (British companies).

Surprisingly, many policy documents of today are still fashioned and designed with the same wordings and format as they were from their inception such as; withnesseth, thereto whereunto and many more. They still the smallest tiny prints, which are not easy to read and write.

• Market environment
• Government policy
• Decisions of the government bodies
• Customer’s reaction to the existing policy and so on.

1.2   STATEMENT OF PROBLEM

Insurance industry just like other industries within the economy such as: manufacturing, construction, education, banking, medical legal professions and many others are not free from problems or diverse forms and nature. The peculiar problems with insurance industry in the recent past include:

• Multiplicity of insurance companies and brokerage firms.
• Lack of adequate awareness campaign to implant this subject in the heart of many.
• Ambiguity in the policy and under writing conditions.
• Registration or incorporation of insurance companies and brokers with less financial base of reserves and professional lapses.
• Stringent or stick policies made by the government and the industry governing body.

1.3 OBJECTIVES OF STUDY

1. To determine the intangibility of insurance policies.
2. To ascertain the extent intangibility cause set back to better service in insurance delivery.
3. To assess the policies that should apply a as a better policy
4. To make reasonable recommendations from the problems discovered.

1.4   RESEARCH QUESTION

1. What causes intangibility in insurances policies?
2. What extent do intangibility causes set back to better service in insurance delivery?
3. How can better policies to apply in insurance policies be assessed?
4. What recommendation should embark upon for problems discovered?

1.5   RESEARCH HYPOTHESIS

H₀ :   Present failure causes intangibility in insurance policies.

H₁ :   Present failure do not causes intangibility in insurance policies.

H₀:   Intangibility of policies causes set back to better service in insurance delivery.

H₀:   Intangibility of policies do not cause set back to better service in insurance delivery.

1.6   SIGNIFICANCE OF STUDY

The Nigeria insurance industry is currently at an important cross road and so there is the need to take stock and review the performance of the industry in order to develop ways to met unfulfilled expectations and future challenges.

There are many potential benefits. Insurers can earn a superior reputation in the market. They can increase engagement and loyalty among staff while reducing turnover rates. Ultimately it will result in insurers becoming more attractive to investors, who are increasingly concerned about CRS and corporate governance.

Some of the benefits are;

1. Paying valid claim efficiently.
2. Risk minimization/loss control.
3. Climate changes leadership.
4. Strategic partnering with charities or organizations in the community for a mutual beneficial purpose, it also of benefit to other stakeholders in the business.
5. Recognition for human right.
6. Socially responsible investment.

1.7   LIMITATIONS OF STUDIES

1. Lack of adequate audience or attention by some of the personnel and practitioners in some of the companies visited as well as refusal to full out the question names for their own personal reasons.
2. Others met are of low status and qualifications as such they could not provide adequate response to the question posted to them.
3. A few others who would have helped in one way of the other found it difficult to carry on owing to the fact that it is in prompt in timing for the project to be ready.
4. Financial inadequacy to seeing to the readiness of the project.
5. Weakness to continue with the research due to stress from school activities.
6. Reference materials seen were of old stock, and as such not relevant except for the comparison and history of the subject matter and so on.

1.8   DEFINITION OF TERMS

The terms to define are as follows:

Insurance:       This is an agreement or contract between two partners to insure a particular subject matter against loss of damage.

Brokers:   These are professional intermediaries between the insuring public and the insurance company.

Re-insurance:  This means re-insuring a particular subject matter which has been insured for a second time. This time the insurance arrangement is between the insurance company (ceding company) and the re-insurance company.

Agent:      these are intermediaries in insurance contract. They are not professional persons and they may emerge from any profession but must possess the ability to convince a prospective client about a policy.

Contra-preferential-rule   This states that any party which draws a document is responsible for it, such any ambiguity or unclearity arising from it shall be continued against such party.

Respondent bond:    This is a situation where cargo is pledge to obtain a loan instead of vessel.

Bottom:    This is a loan obtained by a ship owner to cover vessel being loss to a particular voyage.

Canvassing:     This is a situation whereby an insurance broker or agent goes about seeking for buyers of insurance policy.

Under writing: This is the assessment of risk and deciding on whether to accept the risk cover or not.

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