Avoid Dealing With Unlicensed Brokers, Agents, NAICOM Cautions Insurers

The National Insurance Commission (NAICOM) at the weekend warned insurance operators against dealing with unlicensed brokers and agents to facilitate insurance businesses. Mrs Ebelechukwu Nwachukwu, Chairman, Sub-Committee on Publicity of the Insurers Committee, said this while briefing newsmen on the outcome of the committee’s meeting in Lagos. Nwachukwu, also Managing Director of Royal Exchange General Insurance, stated that NAICOM observed the practice during the ongoing Risk Based Supervision (RBS) in some insurance companies. “The regulator spoke to us very strongly, to ensure that all the agents and brokers we deal with are licensed up-to-date or renewed, as against doing business with brokers with expired licences or unregistered agents,” she said. According to her, NAICOM also recommended self regulation to underwriters, regarding RBS. The sub-committee chairman disclosed that NAICOM directed that boards of the various underwriting firms should approve and implement whistle blowing policy in their respective companies. Nwachukwu said the committee also agreed on the need for the insurance industry to increase awareness on annuity and continue to build trust to ensure that the product line grows significantly. “With the amount of fund in the pension industry, we should expect a lot of that to be downloaded into the insurance industry through annuity,” she said. The sub-committee chairman revealed that NAICOM also expressed concern over the backlog of unpaid claims and charged the defaulting insurers to settle all outstanding claims as soon as possible. She said that the committee resolved that the unpaid claims should be publicised on the platform of the Nigeria Insurers Association (NIA) for first three months to encourage those with lodged claims to come for it. “After the three months and we see that the impact is still outstanding, companies may be mandated to do own publicity. “A lot of unpaid claims have been reported, but supporting documents were not provided, and as such they remain as outstanding claims for so many years,” she said. According to her, the insurance operators further discussed the need for NAICOM to continue to engage the National Assembly to ensure the passage of Consolidated Insurance Bill. Nwachukwu noted that insurers had also begun the process of harmonising the ECOWAS Brown Card to ensure that the same certificate is issued across all countries using the brown card. She said the insurers also took a presentation from KPMG, as part of its planning for the insurance industry’s 10 years Transformation Roadmap. According to the managing director, eight pillars were proposed to the insurance industry as part of the roadmap, which include: continuous improvement of the regulatory environment. Nwachukwu said as part of the proposal, Risk Based pricing and Risk Based capital would become paramount. She stated that increased awareness and improvement in market conduct and ethics was proposed as part of the transformational roadmap to the future that the industry desires. The sub-committee chairman said that the presentation also suggested more partnership with non-insurers players, just as it is done in the banking industry. She stated that the insurers were charged on digitalization and improvement of talents pool of the insurance sector and supporting national economic growth plan.

Nigeria’s Insurance Industry Grew N444.2bn In 8 Years – NAICOM

Despite Nigeria’s economic headwinds the country’s insurance experienced a 13 per cent growth in revenue between 2014 and 2022, the National Insurance Commission has said. Commissioner for Insurance, Mr Sunday Thomas, who disclosed this during his welcome address at the National Insurance Conference on Monday in Abuja, also said the Commission mobilized the insurance industry to contribute the sum of N500 million and free Life Insurance cover for front line workers during the COVID-19 Pandemic. He said, “In terms of its performance Your Excellencies, the industry premium income between 2014 and 2022 grew at an average of 13.6%; from a premium income of N282 Billion to N726.2 Billion. The total assets of the sector also grew at an average of 12% for the same period; from an asset base of N827.5 Billion in 2014 to N2.33 Trillion in 2022.” The NAICOM helmsman noted that despite the upward movement in the industry’s income trajectory, the industry has been hampered by talent gap, comparatively low public awareness, insurance affordability, lack of trust and confidence in insurers, cultural and religious bias, inadequate distribution channels, low enforcement of insurance, among numerous others. Thomas said the Commission under my leadership has remained resilient and focused on implementing initiatives that will foster development of the Nigerian insurance industry and align its fortune with that of the nation as the Africa largest economy. As part of its efforts to reach its goal, the NAICOM boss said the Commission will transform the regulatory environment to sustain the industry growth, ensuring a transition to a risk-based capital model. “Promote insurance awareness and adoption; Broaden insurance product offerings and improve effectiveness of distribution channels; enhance digitalization of the insurance industry; deepen the industry’s talent pool and capabilities as well as support Nigeria’s economic transformation and sustainability agenda, he said. Highlighting some of the flagship projects being implemented by the management of the Commission as part o its medium term Strategic Plan 2021–2023, Thomas explained that the Commission has ensured improved safety and soundness of the Nigerian insurance sector to continue to de-risk economic activities of Nigerians through the enhancement of our prudential regulatory tools and good corporate governance practices; migration of the Commission’s supervisory regime to align with global best practices. According to him, this initiative has enhanced the Commission’s distress management and market restructuring. “Implementation of Project E-Regulation through operationalized Business Process Management Solution and NAICOM Portal.  The BPMS is currently being used to process applications from insurance institutions while the Portal remains the focal point for generation of unique policy identification numbers for all policies as well as repository for statistical data including verification of insurance policies issued in Nigeria,” he said.    The theme of the Conference is “Redefining Safety – Insurance Solutions for Public Buildings and Buildings under Construction”.