LOCAL CONTENT AND GROWTH OF NIGERIA RE-INSURANCE AN OVERVIEW
This study evaluate the expected impact local content on the growth and development of reinsurance in Nigeria. The historical, problems and challenges facing the growth and development of reinsurance business in Nigeria. The prospect efficient and affective management of reinsurance industry. Hence, the concept of local content in oil and gas reinsurance business stating the details, importance and problems of local content to the Nigeria reinsurance companies, the expected impact of local content of economic development of the reinsurance business. However, the data used in this study were collected from two sources primary and secondary data. A liker scaling questionnaire was the major instrument used in ascertaining basic information in the research work. The descriptive survey method was used to analysis data collected for the study. Z – test statistical model was used in testing hypothesis and other response form the respondents and yaros yama sampling technique was used to determined the sample the test conducted, conclusion was made on the findings of the study includes: there is reasons for reinsurance on the growth and development of Nigeria economic. Recommendations were made in respect of the problems facing reinsurance in Nigeria. Suggestion was also made for further study. All these are contained in chapter five, different chapters with reference at the end of each.
TABLE OF CONTENT
Title page i
Approval page ii
Table of content vi
1.1 Background of the study 1
1.2 Statement of problem. 3
1.3 Objective of the study 5
1.4 Research questions 5
1.5 Significance of the study 6
1.6 Scope and limitations of the study. 7
1.7 Definition of operational terms. 8
2.1 An overview 11
2.2 Belief history of Emenite limited. 12
2.3 The concept of risk. 15
2.3.1Definitions of risk. 16
2.3.2Basic categories of risk. 17
2.4 Concept of risk survey 18
2.5 Reasons for risk survey. 19
2.6 The products offers by Emenite limited. 21
2.7 Various risk exposed to Emenite as a company 22
2.8 Duties of a risk surveyor in a manufacturing firm 24
2.9 Factors to be considered in risk survey risk survey. 25
2.10 The implication of risk survey in a manufacturing
2.11 Various methods / strategies used in risk control.29
2.12 The legal frameworks of risk survey David
(1989) outline various legal framework of risk
survey as follow 34
2.13 The problem facing insurance industry in risk
2.14 The prospect of effective risk management
in manufacturing firms 39
2.15 Challenges facing the insurance industry in
effective risk management 40
2.16 Illustration of safety audit according to Daw (1989) 41
Research methodology and design 43
3.1 Research design 43
3.2 Sources of data 43
3.2.1Primary data 43
3.2.2Secondary data 43
3.3 Population of the study 44
3.4 Instrument used for this study 45
3.5 Validity of the instrument 45
3.6 Method of data presentation and analysis 46
4.1 Summary of findings 47
5.1 Conclusion of recommendations 49
5.2 Recommendations 50
5.3 Suggestions for further studies 51
Appendix ‘A’ 54
1.8 BACKGROUND OF THE STUDY
Risk is integral to everyday life. Once we have said that risk is always at the center of our life. This means that for every human endeavour, there is risk as a result of our difference provision according to David (2001), risk exist where the future is unknown. It represents both desirable event when one intentionally initiates certain thing in order to better as socio-economic wellbeing. “Because of these desirable and undesirable events. It is a desirable event when one intentionally initiates certain things in order to better his socio economic wellbeing. Because of these desirable and undesirable events, an organization will want to transfer their risk to an insurance company, which thereby brings about risk survey.
According to David (1989), the prince object of a risk survey is to provide the underwriter with as complete as positive of risk being offered as possible, to enable him decide whether the risk was acceptable and how it compared with the same kind as the basis for deciding premium and other terms.
In the present day, the survey is still closely concerned with provision of underwriting information and in many situations the information disclosed by the complete proposal form, will need to be supplemented by a surveyors reports before the picture is completed. However, the surveyors is now more closely concerned with audient previous, surveying represents one aspect of the wider subject of risk control. Moreover, practice varies among individual insurers and there are no established criteria for surveying manufacturing firms. It may safely be stated that risks of unusual character or with special features will normally be surveyed in that firm. A safety or risk audit will be conduct.
A safety audit is a critical examination of an individual operation in it, entirely to identify potential hazard on level of risk. Audits are often undertaken by multi-disciplinary terms. Individual member should have a good knowledge of legal requirements, an understanding of reasonable practice in the industry and above all the ability to communicate with all levels of personnel or departments within the organizational. In many companies, this expertise is not readily available and so audits tend to be undertaken by external specialist such as consulting engineers acting independently or employed by insurance companies. In manufacturing firms like Emenite Limited, risk that presents a serious injury/hazard is those where there is substantial involvement machinery. Reports from the health and safety executive in Emenite Limited. However, show that save 80% of accidents are not caused by machinery buy by such simple things as falls lifting heavy weights or defectives hand tools.
Risks survey will thereby go a long/greater way in boosting productivity in manufacturing firm via review of risk and it will also help to facilities improvement in the work force of the company like Emenite Limited.
1.9 STATEMENT OF PROBLEM.
Manufacturing firms are exposed to various risks as result of the native of their activities in production of their products. So the roles of risk survey cannot be over emphasized in the manufacturing firms because risk survey plays huge role in sustaining the growth and survival of the manufacturing firms in Nigeria. Nwite (2007) man’s inability to accurately predict the outcome of this undertaken, the consequences of this action or inaction portray the native of man as being finites and faller. As a result, risk becomes inevitable incidence in our day to day activities. For the purpose of this study, the researcher identified some key factors that will help in identify the problem.
a. There are various risk exposure in manufacturing firms.
b. The way of handling such risk exposures have not been encouraging.
c. Risk surveyors in manufacturing firms have not been living up to their expectations.
d. There have been lots of bottlenecks in implementing the proffered recommendations.
e. To know role of surveys in identifying such risk and controlling the affects in the operation of manufacturing firms in Nigeria.
1.10OBJECTIVE OF THE STUDY
The objectives of this study is to fluid out various risks confronting manufacturing firms in Nigeria and the firm of risk surveys in identifying such risk exposures and the adverse effects in the manufacturing firms. Therefore, the objectives of this study are as follows:
a. To find out the various risk exposure to manufacturing firms in Nigeria.
b. To find out various ways of handling such risks exposure in manufacturing firms.
c. To find out the problems facing the insurance companies/industries in identifying such risk exposure in manufacturing firms.
d. To know the role of risk survey in manufacturing firm.
e. To make recommendation on how to improve the manufacturing firms through adequate risk survey tools by the insurance industry.
a. What are the various risk exposures in manufacturing firm in Nigeria?
b. How can such exposure be handled by the insurance industry in order to keep the manufacturing firms going?
c. What are the problems facing the insurance industry in risk survey in manufacturing firms?
d. What are roles of risk survey in manufacturing firms in Nigeria?
e. What are the recommendation to improve risks survey in manufacturing firms?
1.12SIGNIFICANCE OF THE STUDY
A risk survey is that core are of insurance business. So, its role in manufacturing firms can not be over emphasized. The study will help:
1. The insurer to know the best techniques in treating those risk that threaten the existence of manufacturing firms.
2. The insurer to know risk that are facing the manufacturing firms and provide solution for those identified risks.
3. The study will also be relevant to academic who wishes to know the data and information about risk survey in manufacturing firms.
4. In enlighten the manufacturing firms about those risk they are exposed to in their daily operations.
5. The study will serve as a dimension to further researcher and it will give then the basis for validity or disapproving the findings of this researcher.
6. It will be also the basis for further research.
7. It will also be the basis for the award of B.Sc in insurance and risk management.
1.13 SCOPE AND LIMITATIONS OF THE STUDY.
Scope refers to the dimensional of coverage of this work. It is restricted to Emenite Limited Enugu. The information gathered will be used as reference to other manufacturing firms within the federation.
In carrying out the research work, the researcher was faded with certain problem which includes:
i. Time: Time constraints, as a student researcher, the problem of trying to keep up with lectures and at the same time running around for the collection of necessary information for the completion of this research work.
ii. Money: The cost incurred in carrying out this study is very tight in terms of transportation, photocopying, internet browsing and others.
iii. Corporative: The incooperative attitude of some students due to their duty of secrecy.
iv. Data: The difficultly of obtaining relevant materials pertaining to this research work.
1.14DEFINITION OF OPERATIONAL TERMS.
Hazard: It is referred as the condition that creates or increase the chance to loss arising from given peril. (Okonkwo, 1998).
Hedging: It is a risk transferring mechanism. It can also be the option or a future option where an organization may decides or arrange a contract with a supplier/dealer of many particular product to supply them and he pays premium, so that no matter the level of increase or decrease in price, the supplier must supply that product to the organization (Nwite, 2004).
Insurances: It is a contract between two parties the insured and insurer whereby, the insurer promises to identify the insured if the insured event happens and on the other hand the insured will pay a sum called premium to the insurer. (Aneke, 2004)
Insurer: It can said to be insurance company who offers protection/grant loss or insured peril. (Aneke, 2004).
Insured: This is the individual or organization that pay premium to insurer on interest to be indemnified/pay compensation back to then (insured) it negative unforeseen even happens to the subject matter that is insured.
Risk Control: It is various ways of handling risks or ways of controlling risks (Rayo, 2001).
Moral Risk: This is concerned with the attitude and conduct of people. In insurance, this will be primarily the conduct of the insured and insurer (Okonkwo, 1998).
Premium: This is the price paid for the purchase of an insurance cover which will be paid monthly or annually or the price for which the insurer undertakes the insured liability (Aneke, 2004).
Risk Survey: It can be defined as the prime object of an survey to provide the underwriter with a complete picture of the risk being offered to cover (Jones 1989).
Salvaging: This involves training of people for quick responses in protection of damaged plant or to prevent further damage (Write 2004).
Safety Audit: It is a critical examination of an industrial operation to identify potential hazards and its level of risk (Jones 1989).