Microinsurance will drive insurance growth and deepen financial inclusion – Gbadegesin

GOXI Microinsurance Limited is breaking poverty barriers through inclusive risk protection and tailored products. Shina Gbadegesin, managing director/chief executive officer, shares insights in this interview with Hope Moses-Ashike. Excerpt.

GOXI Microinsurance is widely recognised as Nigeria’s first licensed microinsurance company. Can you tell us about the journey so far?

Thank you very much. GOXI Microinsurance is indeed the first licensed microinsurance company in Nigeria, licensed by the National Insurance Commission, NAICOM. We commenced full operations in 2019, and it has been a very rewarding journey since then. From inception, our vision has been to become the leading provider of microinsurance products and services that truly enhance the living standards of low-income people. Our mission is to break the barrier of poverty and give meaning to the lives of our customers through innovative risk management solutions.

When we started in 2019, there was no local operator functioning purely as a specialised microinsurance company in Nigeria. That experience has been both challenging and exciting. It was challenging because there were no local specialised microinsurance operators that we could easily run to learn from at that time, so we had to rely heavily on global research. We studied different microinsurance models across the world, examined their strengths and weaknesses, and adapted what suited the Nigerian environment. At the same time, it has been an exciting journey because we have been able to prove that a standalone microinsurance model can actually work in Nigeria.

What would you say has been the most fulfilling aspect of this journey?

One of the most fulfilling aspects has been correcting the misconception that low-income people do not buy insurance. Our experience has shown that they do buy insurance, as long as the products meet their needs and are delivered through the right channels. Beyond that, seeing how our services have positively impacted lives has been deeply rewarding. Particularly during claims payment, when customers receive benefits at critical moments, it reinforces our belief that microinsurance is making a real social and economic impact on the lives of low-income individuals and micro-business operators.

Since GOXI was licensed, have there been other players in the microinsurance space?

Yes, after GOXI was licensed as the first microinsurance company by NAICOM, several others have entered the space. From what I understand, there are now about 17 microinsurance companies fully licensed by NAICOM in Nigeria. This growth shows that the sector is gaining traction and recognition.

Can you highlight some of the key milestones GOXI has achieved since its inception?

Certainly. Since inception, we have recorded well over 1.4 million transactions cumulatively, executed over the last six years. We have also paid claims in excess of N790.8 million. These claims were paid mostly to economically challenged individuals and micro- and small-business operators who previously believed that insurance did not work.

Our interventions have helped promote financial sustainability. Many of these individuals would ordinarily have fallen into abject poverty due to unforeseen events such as fire, death, burglary, or business disruption. Through insurance intervention, they have been able to recover and continue living financially stable lives. In total, we have paid claims to well over 3,500 low-income individuals since we began operations.

What is the scope of your current operations, and are there plans for expansion?

Currently, GOXI is a state-licensed microinsurance operator, licensed to operate within Lagos State only. However, we have made significant progress towards upgrading to a national microinsurance licence. We have formally applied to NAICOM, met all regulatory requirements, and submitted all necessary documentation. Approval is currently ongoing, and the delay is largely procedural.

Regarding capital, the current requirement for a national microinsurance licence is about N600 million, and we have fully met this requirement. Once the national licence is approved, we plan to expand across Nigeria, leveraging partnerships to reach remote and underserved communities. Our goal is to provide microinsurance services to financially excluded, low-income individuals and microbusiness operators nationwide. At that stage, we believe we will be able to reach not less than five million customers.

How does microinsurance differ from conventional insurance?

Fundamentally, both conventional insurance and microinsurance operate on the same principle of risk pooling. However, the difference lies in the characteristics of the target market and how products are designed and delivered. For microinsurance to be effective, products must be simple and easy to understand. They must also be easily accessible, because low-income people often do not have the luxury of travelling long distances to access financial services.

In addition, microinsurance products must be flexible enough to address the specific and daily needs of low-income individuals. If a product does not address those needs, they simply will not buy it. These factors are what truly differentiate microinsurance from conventional insurance.

How has microinsurance contributed to financial inclusion in Nigeria?

Microinsurance, as a subsector, is still evolving in Nigeria. While conventional insurers also offer microinsurance products, specialised microinsurance operators are gradually making a significant impact. Insurance penetration in Nigeria remains below one per cent, which presents a huge opportunity. Over time, specialised microinsurance operators will play a critical role in expanding insurance coverage and driving financial inclusion, especially among low-income populations.

Trust and awareness remain major challenges in the insurance sector. How has GOXI addressed this?

Trust and awareness are indeed major challenges. At GOXI, our strategy has been built around partnerships. We work with partners who already have established trust within their communities. By leveraging these partnerships, we are able to reduce trust barriers significantly.

We also use our partners’ platforms for education, community engagement, and awareness creation. Through these channels, we explain how microinsurance works and demonstrate its value. This approach has helped us build confidence and deepen acceptance among low-income customers.

Lastly, our awareness strategy, which has been clearly designed to address both Below The Line (BTL) and Above The Line (ATL) customers, has yielded tremendous results beyond our imagination.

What were some of the major challenges GOXI faced in its early years?

Being a pioneer was one of our biggest challenges. There was no local blueprint to follow, so we had to develop our operating model from scratch. Another challenge was shifting the mindset of early partners and customers. Insurance awareness was generally low, and microinsurance as a concept was poorly understood.

We also faced external challenges. Shortly after we commenced operations, COVID-19 struck. That period tested our resilience. Many businesses were shut down, and economic activities slowed significantly. However, it also became an opportunity for us to build trust. Our ability to continue honouring claims during that difficult period strengthened confidence among our partners and customers.

Claims payment is often seen as the true test of insurance value. How has GOXI performed in this area?

Claims payment is central to our strategy. Our mandate is to settle claims within 48 hours once all required documentation is submitted. Over the past six years, we have consistently met this timeline. Our partnership model has helped streamline the claims process, making it faster and more efficient. This responsiveness has greatly enhanced trust and reinforced our reputation as a reliable microinsurance provider.

GOXI is a member of the Microinsurance Master global network. What value has this brought?

We became members of the Microinsurance Master in 2022. It is a global accelerator programme and network of microinsurance practitioners. Membership has given us access to a global repository of knowledge, innovative ideas, and proven practices. It allows us to learn what works across different markets and adapt those insights to our operations. This has positively influenced our strategy, product development, and service delivery.

Finally, what opportunities do you see in Nigeria’s microinsurance market?

The opportunities are enormous. While low insurance penetration is often viewed as a challenge, we see it as a major opportunity. According to data from organisations such as EFInA, over 31.2 million Nigerians are interested in microinsurance products. In addition, Nigeria has more than 20 million microfinance bank customers, all of whom represent potential microinsurance clients.

Even at a minimum premium of N100 per month, the market opportunity exceeds ₦80 billion. When you compare this potential with what has been achieved so far, it is clear that the sector is still largely untapped. This excites us as operators and motivates us to continue designing innovative products and strategies to serve this vast segment of the population.

Regulation plays a critical role in shaping the microinsurance ecosystem. How would you assess NAICOM’s regulatory framework for microinsurance so far, and what areas require further refinement to unlock faster growth?

The existence of a regulatory framework is very critical in the development of microinsurance in any country that desires to drive inclusivity of the informal community. This will help to bring clarity and remove ambiguity among the operators of microinsurance. Global reports confirmed that countries with a microinsurance regulatory framework recorded positive growth in their microinsurance development compared to countries where there is none.  We must therefore commend the Insurance Regulatory body in Nigeria – NAICOM – for the existence of the Microinsurance Guideline, which has been very instrumental to the relative progress being made in Nigeria. However, there is room for improvement, which I believe is currently being addressed through the NIIRA Implementation Group set up by NAICOM ahead of the introduction of new Microinsurance Guidelines that the commission is about to release.

Nigeria’s economic volatility, inflationary pressures and income shocks disproportionately affect GOXI’s target market. How does the company balance affordability with sustainability in such an environment?

Building a sustainable microinsurance model requires a thoughtful approach that balances viability with social impact. Especially in the Nigerian context, where there are a lot of barriers to scaling and penetration of insurance, an operator must be able to carefully drive a model that balances premiums, claims and expenses while also generating a reasonable return on investment.

Driving a sustainable microinsurance model requires being customer-centric. The implementation of our customer engagement strategies and tools, which enable us to mingle, engage and interact with our target population, has been very useful in product design and meeting the needs of the segment.

Only one institution cannot effectively deliver a microinsurance solution. Partnership and collaboration are key to achieving scale, trust and delivering a sustainable microinsurance model.  We have also not, in an attempt to serve the customer, ignored the need and relevance of our partners in co-creating solutions that both serve the need and expectation of both the customers and partners in order to create a win-win relationship.

Our ability to fully adapt technology for operational efficiency has helped in reducing costs and efficient service delivery. Lastly, fostering a culture of innovation and experimentation has made us stay ahead in addressing emerging challenges.

What would you identify as the most pressing challenges currently confronting the microinsurance sector in Nigeria, and which of these require industry-wide collaboration rather than company-level solutions?

Generally speaking, insurance services are not always ranked among people’s lists of priorities, for both low-income and high-income earners. But this is largely more pronounced among the low-income, who are the target customers for microinsurance. This can be attributable to multi-level factors, the first of which is economic-related factors. According to recent statistics by the World Bank, well over 56% of the Nigerian population are poor. So when the disposable income of people is not able to adequately meet their physiological needs, it then becomes difficult for them to think or consider taking up insurance. Another factor is the one I termed “GOD FORBID”, which is largely attributable to issues around our culture and belief system. Nigerians, especially low-income households, often do not believe there is a need to plan for shocks until the event happens. Sometimes our belief systems erode our sense of judgement on the need to plan for hazards.

Lastly, and the most prominent amongst all the factors, is the issue of awareness. The 2023 Efina Access to Finance report stated that 11% of Nigerians, equivalent to 12.2 million people, are aware of microinsurance products. This highlights a significant gap in financial literacy and access to risk management tools in the country. This factor cannot particularly be handled by individuals but requires a multi-stakeholder approach in jointly embarking on target campaigns to reach underserved communities.

And speaking about awareness creation, we have always committed a huge budget towards awareness creation targets for the Below The Line (BTL) and Above The Line customers of microinsurance. Apart from other community campaigns that we have always embarked upon, we introduced the “GOXI Annual Microinsurance Conference” about three years ago. The first of its kind in Nigeria. The thought behind the initiative was to create a platform that can help foster growth and development of microinsurance in Nigeria by bringing together local and international stakeholders from different sectors to deliberate on issues around microinsurance and craft effective strategies to aid the development of the sector. This year’s GOXI Annual Microinsurance Conference was held last month and co-hosted by GOXI and Microinsurance Network, a global international multi-stakeholder organisation for experts to work together on key areas of development in inclusive insurance. The conference was well attended by industry stakeholders, which cut across regulators, multilateral organisations, MSME stakeholders and insurance industry executives.

As a leader in the sector, this conference is one of our company’s contributions towards addressing awareness challenges facing microinsurance and the insurance industry as a whole.

After several years as managing director and a pioneer in this niche, what legacy do you hope GOXI Microinsurance will leave for the Nigerian insurance industry and for financial inclusion more broadly?

We have within the few years of our existence built a strong reputation as a trusted brand in the microinsurance segment in Nigeria, delivering customer-centric microinsurance solutions to our target market. Our commitment to building a virile and more responsive microinsurance sector is currently changing the narratives among the low-income households and nano- and small-business entrepreneurs, raising trust and advancing the level of awareness of microinsurance. We are committed to continuing to contribute to the social and economic development of Nigerians through job creation and deepening insurance inclusion with tailored innovative products that make low-income households, especially the nano- and small-business entrepreneurs, more resilient and quickly responsive to shocks.

Hope Moses-Ashike is an Associate Editor, Banking and Finance, with more than a decade of experience reporting on Nigeria’s financial system and broader economy. She closely tracks market movements, monetary policy decisions, company disclosures, regulatory actions, economic indicators, and global developments, and interprets what they mean for businesses, investors, policymakers, and households. Her reporting helps readers understand complex issues such as inflation trends, foreign exchange market dynamics, interest rate decisions, bank performance, and investment risks.

She also covers major international events and periodically travels to Washington, D.C., to report on the World Bank/IMF Spring and Annual Meetings. Her dedication to financial journalism has earned her multiple recognitions and invitations to high-level professional development programmes. She is an alumna of the International Visitors Leadership Programme (IVLP) in the United States and holds an Advanced Financial Journalism Certificate from the Press Association Training in London, UK. Her other notable achievements include completing the Lagos Business School CMC Programme, the Bloomberg Media Africa Initiative Programme, and a Master Class in Journalism at Rhodes University in South Africa.

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