Nigeria’s financial stability and the credibility of its insurance market depend partly on how effectively claims are investigated, assessed and settled, with loss adjusters playing a critical role in protecting policyholders and preventing unjustified depletion of insurers’ funds.
Ikechukwu Udobi, president of the Institute of Loss Adjusters of Nigeria (ILAN), said the profession provides an independent technical assessment of insurance claims, helping to ensure that settlements reflect actual losses and the terms of insurance contracts.
Speaking on the sidelines of ILAN’s 44th Annual General Meeting (AGM) in Lagos, Udobi explained that loss adjusters serve as a critical link between insurers and policyholders, particularly when large and complex claims require specialised investigation and valuation.
He said their work promotes fairness, transparency and accountability in claims settlement, which are essential to sustaining public confidence in insurance and strengthening the financial position of underwriting companies.
“Loss adjusters are claims experts specially trained to investigate, assess and issue reliable reports for claim settlements, especially for large and complex claims,” Udobi said.
The ILAN president noted that the profession’s contribution extends beyond determining how much an insurer should pay, as independent assessments also help prevent fraudulent or inflated claims from undermining insurers’ financial resources.
He cited a major fire claim in the electronics sector valued at more than N67 billion, which loss adjusters reportedly assessed and resolved at approximately N47 billion following detailed technical investigations.
The case, according to Udobi, demonstrates how professional loss assessment can protect insurers from excessive financial exposure while ensuring that genuine losses are appropriately recognised.
Udobi, however, said loss adjusters do not determine insurance coverage independently or create gaps in protection during claims assessments. Their responsibility is to interpret the contract between the insurer and the insured and evaluate the circumstances of a loss against its provisions.
“The role of a loss adjuster is working with the policy document. The policy is the organic instrument of our operation. It is a contract document between the insured and the insurer. What we do is look at the policy vis-à-vis the circumstances of loss and then issue our report in line with the policy provisions,” he said.
He explained that what policyholders sometimes perceive as coverage gaps often relates to items or circumstances that were not included in the original insurance contract.
“From the perspective of an adjuster, there is no gap, because the adjuster will work based on what is in the policy. What may be considered a gap is what is not in the policy that forms part of the claim, and the adjuster will not allow that because it is not covered,” he added.
Under the claims assessment process, loss adjusters investigate the circumstances surrounding an incident, establish the extent of damage and submit technical reports to insurers for review and consideration. Depending on the arrangement, either the adjuster or the underwriting company subsequently issues a discharge voucher to the policyholder for acceptance.
Udobi also defended the withdrawal of discharge vouchers where fresh information emerges after an initial assessment, saying such decisions are sometimes necessary to establish the authenticity of claims and protect the integrity of the insurance market.
“When it comes to issuing a discharge voucher, if information emerges after the process that can alter the position of the discharge voucher, it can be withdrawn. There is nothing abnormal about that. The most important thing is that the claim being paid is a genuine claim,” he said.
He added that where further investigations establish that the claim is genuine, the discharge voucher is reissued to reflect the appropriate settlement amount.
On the differences that sometimes arise between the amounts claimed by policyholders and final settlements, Udobi said adjustments are guided by fairness, equity and the specific conditions of insurance policies.
Factors such as depreciation and policy excess, he explained, determine the actual value payable, except where the policy provides for reinstatement.
“If an item was insured at N1 million and has been used over time, naturally it will be depreciated unless it is a reinstatement policy. By the time we look at the average depreciation rate and apply policy excess, the final figure reflects the true value at the time of loss,” he said.
He stressed that registered loss adjusters are trained professionals regulated by the National Insurance Commission (NAICOM) and their professional institute, adding that policyholders are engaged during the assessment process to explain policy provisions and manage expectations.
Such engagement, he said, helps policyholders understand why certain items may not qualify for compensation and prepares them for possible claim outcomes, including repudiation where losses fall outside the agreed coverage.
The importance of this professional oversight is particularly significant as Nigeria’s insurance industry emerges from a major recapitalisation exercise under the Nigerian Insurance Industry Reform Act. Stronger capital positions could enable insurers to assume larger risks, but maintaining that capacity will also depend on disciplined underwriting, credible claims assessments and effective management of financial exposures.
Beyond its claims-related responsibilities, ILAN is seeking to strengthen the professional capacity and institutional standing of loss adjusters. Udobi said the institute had recorded progress under its BIRDS agenda since the current administration was inaugurated in October 2025.
As part of efforts to improve the financial sustainability of the profession, ILAN signed a revised scale of fees agreement with the Nigerian Insurers Association, which took effect on January 1, 2026. The agreement provides for improved professional earnings and periodic reviews of the fee structure.
The institute is also pursuing stronger international collaboration following a strategic engagement with the Chartered Institute of Loss Adjusters in the United Kingdom on August 27, 2026. The visit resulted in a draft memorandum of understanding currently undergoing review by ILAN’s Governing Council.
On regulatory engagement, Udobi said the institute had maintained working relationships with NAICOM and participated in key industry initiatives, including the launch of the Policyholders’ Trust Fund, public hearings on the Nigerian Insurance Industry Regulatory Bill and state-level initiatives aimed at expanding insurance penetration and youth development.
The institute is also investing in professional development and membership growth. Seven candidates who completed the Associateship Examinations in April 2026 are undergoing internships ahead of their planned induction in March 2027, while 19 new ordinary members have been approved by the Governing Council.
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Modestus Anaesoronye is a leading Nigerian financial journalist with over two decades of experience reporting on the insurance and pension sectors across Nigeria and West Africa. He has held key editorial positions at major national media outlets, including The Comet, The Nation, and Financial Standard, and currently serves as a Senior Financial Analyst at BusinessDay Media Ltd.
A widely travelled reporter, he has covered industry developments in more than 14 countries across Africa and Asia.
Anaesoronye is a multiple award-winning journalist, honoured several times as Insurance Journalist of the Year and Pension Journalist of the Year by recognised industry bodies, including PensionScope and the Pension Fund Operators Association of Nigeria (PenOp), among others.
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