THE CHALLENGES OF MARKETING LIABILITY INSURANCE PRODUCT IN A DEVELOPING ECONOMY

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ABSTRACT

This study, the challenges of marketing liability insurance product in a developing economy. The objective of this study is to understand the meaning of product liability insurance contract, to ascertain the challenges faced in marketing of insurance product in a developing economy like Nigeria. The primary data for this research study were obtained from the use of personal interviews, direct observations and questionnaires while the secondary data were collected from textbooks and journals etc. data collected and analyzed including the text of the relevant hypothesis based on the finding of this study, summary, conclusion and the recommendation were as follows. There should be standardization of insurance on any liability that may be incurred, insurance company should work on their agents, there should be an information from the internet and any other site, create a database for their clients and potential customers.

 

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

Product liability has gained prominence during the past 50 years. Most disputes involving injuries caused by the product are governed by the rules of responsibility. Product liability is one of the cost components of the fastest growing that manufacturers and retailers are facing these days. Production of risk, leading to two associated cost.

The concept that deals with the economic consequences of transferring risk, buying insurance protection constitutes and important element in risk management. Insurance performed under legal contracts, under which the insurer promises to reimburse the insured in case of occurrence of accidental losses specified in the contract. Insurance implied an agreement between the insured who pays a premium and the insurer promises to reimburse the insured for financial loss incurred for specified risks.

Product liability is the legal responsibility of manufacturers, traders, wholesale and retail traders of a product, use/consumption of which could cause harm users/consumers of material injury, medium healthcare, etc.

For the fact that the product is defective and not according standard declared. For example electric shock by not technical insulation of an electrical device or high fuel consumption of a vehicle engine defects insurance against liability of manufacturer or traders for claims that generally draw consumers or purchasers for the damage they have suffered from the use of the product purchased as called “product liability insurance”.

Responsibility of product defects, e.g. has not restrain healthy subjects, not according to statement on the label, is packaged worse, no complete information label for ingredients, method of storage usage etc. Start from the manufacturer and follows the chain taking up all his distribution choice from wholesale dealers and retailer and to the consumer/user as undergoes of the damage. In any case, the insurer’s liability insurance limit determine a lot of how far can we ensure that called aggregate limit of liability product. The limit represents the amount of money that an insurer will pay over the period of the policy is in force, until maturity or expiry data for all claims for liability / obligation to the producers/product covering.

In the background of product liability in many countries is applied the so called doctrine of privilege of the contract which refer to a contract under which the vendor completes its responsibility towards a product that sells directly after subsequent buyers.

1.2 STATEMENT OF THE PROBLEM

Most of the companies of food products has not enough information for product liability insurance food production companies do not provide product liability insurance for big part of their products. In most market, does not have label products that are genetically modified product (GMO). Cancerous diseases were higher due to the consumption of genetically modified products.

Most insurance companies offer “product liability insurance”, while those companies which do not offer this product examined that their staff had no information for the existence of this product.

70% of business have sufficient information about the product “product liability insurance” while 30% of them do not have enough information regardless of which media are reporting every day for products that are dangerous and which should be provided.

And the level of this information is very small for the majority of companies or business and many more split on another section and the rest have no information at all

From the survey it result that 50% of companies have less information for the “product liability insurance”. But considering that the law itself has many shortcomings in the provision of product liability and consumer protection, companies do not view important to considering how many manufacturing business currently exist.

1.3 THE OBJECTIVE OF STUDY

The objective of the study as to investigation the challenges of marketing liability insurance product. Other specific objective to be accomplished includes:

  1. To understand the meaning of product liability insurance in insurance contract.
  2. To know why most companies and business don’t have sufficient information about product liability insurance.
  3. To know the harm and effect on consumer for the consumption of a genetically modified product.
  4. To ascertain the challenges face in marketing of liability insurance product in developing country like Nigeria.
  5. To find solution to the challenges of marketing insurance product.

1.4 RESEARCH QUESTION

The following question will be use in the course of this research study. The research on the challenges of marketing liability insurance contract will make use of the under listed question, representing the basic research question include the following:

  1. What is marketing on liability insurance product.
  2. What is the important of marketing liability insurance contract?
  3. What are the challenges faces on liability insurance product?
  4. Of what important is the marketing of insurance product to the public?
  5. Can there be solution to the challenges of marketing liability insurance product in a developing economy (like Nigeria)?

1.5 RESEARCH HYPOTHESIS

H0: There are no challenges on marketing liability insurance product.

H1: There is a significance challenges on marketing liability insurance contract.

1.6 SIGNIFICANCE OF THE STUDY

The study is focused on the challenges of marketing liability insurance product in insurance contract. This study will be beneficial to the public, business and insurance companies in the society that lack knowledge about the challenge that is faced in product liability insurance contract and to know the reason why most people had no information for the existences of this product.

This study is also intended to provide yardstick for underwriters, insures, companies managers in Nigeria to improve on the level of their marketing or business and many of them have no enough information regardless of which media are reporting every day for products that are dangerous and which should be provided, more split on another section and the rest have no information at all.

Researchers may be interested on the subject matters challenges of marketing liability insurance product.

1.7 SCOPE OF THE STUDY

The scope of the research shall be limited to selected insurance firms in Port Harcourt comprising of the Lead way insurance company, Afri Insurance cornerstone insurance company, Allied insurance company, Micon insurance company and Anchon Company etc within the area of the research.

1.8 LIMITATION OF THE STUDY

The most limiting factors I encountered in course of carrying out this research. Work was sourcing of material was a difficult task due to the fact that some material were not available at the time of writing lack of finance and also discouragement from people sine there was no available material for this project topic.

1.9 DEFINITION OF TERMS

MARKETING:       It can be defined as all human activities directed at satisfying all human needs and want through exchanges process.

PRODUCT LIABILITY:         It could be defined as a legal liability that covers bodily injury or property damages which arises out of goods or products manufactured, constructed, altered, repaired serviced treated sold, supplied or distributed by the insured.

CHALLENGES:     It refers to a difficult task especially one that the person making the attempt finds more enjoyable because of that difficulty.

LIABILITY:   Liability can be defined as the insurance policy that provides cover for the insured against this legal liability to others.

INSURANCE:        Insurance is defined as an arrangement by which an insured transfers his risk (uncertain tendency to loss) to the insurer at an adequate fee called premium, on the promise that the insured shall be unverified or compensated upon the occurrence of the insured event.

CONTRACT: Contract can be defined in insurance terms as the legal agreement between two parties the insured and the insurer, that the insurer indemnifies the insured at the time of loss occurrence.

PRODUCT:    Product can be defined as anything that is capable of satisfying human needs and went.

 

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