Business Insurance (Risk Management) : A lesson from #ENDSARS

Business insurance is a risk management tool that enables businesses to transfer the risk of a loss to an insurance company.

Timi Olubiyi, Ph.D


Angry Nigeria’s youth found their voice with a street protest against police brutality -#EndSARS. The youth demanded that the police unit known as the Special Anti-Robbery Squad (SARS) be disbanded among other demands. Undeniably, these youths are under the age of 35 and they make up more than 50% of Nigeria’s population according to statistics. Sadly, these energetic youth are faced with chronic unemployment, and with that, they usually have ample time which recently included the protest movement that lasted for about two weeks in October 2020.

However, the protest was hijacked by another set of youth (hoodlums) after a gruesome shooting at Lekki toll gate on the 20th of October 2020. The aftermath of the shooting was accompanied by several lootings and vandalism at several shopping malls in some cities in Nigeria particularly in Lagos State, which included Lekki Shoprite Mall, Circle Mall, Surulere Shoprite Mall, Montaigne Mall, Lagos City Mall, Lagos High Court building, and many business premises and departmental stores in the State. Some facilities including public-owned buildings were also vandalized and some razed with fire among these are the Lekki Toll Gate, and several police stations in the State and across the country, local government councils, public transportation infrastructure particularly the buses (BRT), and other meaningful facilities by hoodlums who are said to have hijacked the peaceful protests and created chaos across major cities in Nigeria.

The unforgettable occurrence involved inconvenience curfews, loss of lives, loss of government and business revenues, destruction of properties and loss of court and crime records due to the blazing fire, and ultimately loss of means of many livelihoods. It will be difficult to generally quantify the value of the losses since it involved loss of lives. However, this unforeseen circumstance is the reason why insurance policy must be in place for government, businesses and high net worth individuals to cover these insurable losses.

Business Insurance to the Rescue

It is significant to state that business insurance is a risk management tool that enables businesses to transfer the risk of a loss to an insurance company. In fact, running a successful business always comes with inherent risks and one of such was the #ENDSARS aftermath. Unequivocally, business insurance can be a helpful policy to protect financially, from some of these needless losses and consequences. World over, one major role insurance provides is security against risk and uncertainty.

More so, business insurance usually covers and protects businesses from losses due to events that may occur during the normal course of business. For individuals, life insurance is also recommended, which is a contract between an insurer and a policyholder in which the insurer guarantees payment of a death benefit to named beneficiaries when the insured dies. Life insurance is also a form of protection and can help keep loved ones financially afloat. The insurance company promises a death benefit in exchange for premiums paid by the policyholder.

In the case of a business or company it is important to have business insurance because the financial consequences of a potential mishap could easily wipe out the assets of the firm particularly Small and Medium Enterprises (SMEs). An unforeseen event like the #ENDSARS aftermath can adversely impact businesses if the company does not have an insurance policy to help protect against such an event or lack adequate capital to restore any loss. Significantly, it may lead to the end of a business if not properly managed.

Importance of Business Insurance

However, business liability insurance can help to minimize risks so that the business continues to operate and grow. Largely, in an event where business hits severe misfortunes, it may not be able to solely afford the cost of getting back on track and running again. However, in the case of an insured business, the risk is shared between the company and the insurance company.

So, the essence of this piece is to stress the importance and benefits of having a business insurance policy in place as part of the strategy for the smooth running of business operations. When a company makes losses, the insurance company is there to come to the rescue, if an insurance policy is in place. Upon having a business insurance policy in place, these are some of the benefits to a business, which are: the minimization of financial losses in case of any eventualities, the insurance company can provide property damage coverage as well, especially the liabilities from accidents, natural disasters, or even lawsuits and settlements. These benefits help promote the business continuity of any company once an insurance policy is in place. Some of the available specific insurance policies are general liability, professional liability, property insurance, vehicle insurance, directors’ and officers’ liability insurance among others.

In practice business insurance shows prospective clients and customers that a business is secured and that can help build trust. Just in case anything goes wrong the respite is that insurance is there to compensate against any loss. When insurance policy is in place, policyholder can immediately approach the insurance company in case of any experience of an insurable loss. With the proper business insurance, business owners can achieve peace of mind and focus their attention on what they do best-operating a productive, profitable, and personally rewarding business.

Pleasingly, when more large firms and SMEs in the country engage the services of insurance companies it will eventually provide employment opportunities for some of the teeming youths. How? Because it will encourage the entry of private insurers and more insurance companies thereby increasing employment opportunities.

Eventually, when the insurance landscape evolves in Nigeria, it will further provide a sense of livelihood to those who might otherwise not have an income source right now- graduates, unemployed professionals, retired people, etc because they will be able to work as agents and equally earn commissions.

Recall, insurance companies similarly pay taxes out of profits earned, therefore this can be an important revenue source to the government as well, if policy responses and economic palliatives are channeled towards the development and growth of the insurance sector in the country. For emphasize insurance funds can be made available for economic development particularly for the development of infrastructure and social sectors. Since insurance companies are strong players in the financial sector, their insurance funds could be an important source for infrastructure finance for projects (roads, power, water supply, etc.). Research and data corroborate the evidence that insurers and insurance companies desire to invest in infrastructure investments. They look for opportunities to invest in lower-risk infrastructure projects with sustainable returns across longer periods. This suggests that the government can make use of this platform adequately and reasonably for infrastructure development.


Irrespective of all the highlighted benefits and importance of insurance to government, business, and people, in summary, no one can adequately predict the future. Therefore, it is imperative to have an insurance cover to keep business up and running and life insurance cover for individual’s protection against risk. Good luck!

How may you obtain advice or further information on the article? 

Dr. Timi Olubiyi is an Entrepreneurship and Small Business Management expert with a Ph.D. in Business Administration. He is a prolific investment coach, business engineer, Chartered Member of the Chartered Institute for Securities & Investment (CISI), and a financial literacy specialist. He can be reached on the twitter handle @drtimiolubiyi and via email:, for any questions, reactions, and comments.

Leave a Reply

Your email address will not be published.

WP Twitter Auto Publish Powered By :