Life Insurance Companies Funding Housing in Africa?

Life insurance companies in the United States have a bad wrap, but in Nigeria, it may be a different story. Housing experts advised that a large percentage of pension and insurance funds should be invested in housing to assist in the rapid development of the sector in Nigeria, and there’s a good chance the government will comply. Housing experts urged them to emulate advanced economies, where pensions and life insurance, funds are invested to finance housing. Mr. Bunmi Ajayi, a former President of the Association of Professional Bodies of Nigeria, remarked that the major problem facing the housing sector was securing long-term funds for financing housing project.

"The major challenge facing the mortgage institutions at the moment is getting long-term funds for mortgage financing," he said. However, he also noted that Nigeria could overcome the problem if pension and life insurance funds were invested in housing projects, due to their long-term nature of maturity. Mr. Goke Kupolati, Managing Director, Skye Mortgage Bank, said that pension and life insurance companies' funds were the long-term investments needed make the mortgage industry deliver mass housing in the country.

He asked government to mandate the pension funds managers and life insurance companies to finance housing schemes. Mr. Tai Oyafemi, Head, Network Distribution and Channels Management, remarked that following the short-term nature of investments in Nigeria, investors, including life insurance companies, were always chasing such for quick returns. Whatever the case, if that’s the countries only source of long term funds, so be it. It may be for the greater good, and ideally it could help people find housing, therefore improving their health at the same.