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Wanted: stronger laws – The Nation Nigeria

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After 10 years of seeking to strengthen insurance laws, NAICOM’s frustration seems to have grown. Omobola Tolu-Kusimo writes that the commission is in dire need of strength through new laws to tackle issues against the development of the industry.

A bill to amend the insurance laws has been in the works for 10 years, passing from one National Assembly to another without the desired progress.

The bill, which was drafted by former the Commissioner for Insurance, Fola Daniel, was expected to have made progress and passed by the National Assembly during the tenure of  the immediate past Commissioner, Mohammed Kari, but his efforts did not did not see the light of the day.

However, the Acting Commissioner, Sunday Thomas, is intensifying efforts by bringing the Bill to the attention of the Ninth Senate.

In a keynote address by Thomas at the retreat for members of the House Committee on Insurance and Actuarial Matters in Uyo, Akwa Ibom State, he said the Commission, as a statutory regulatory agency, derives its powers from the National Insurance Commission Act 1997 and the Insurance Act of 2003 to oversight insurance practice.

He believes the event provides him the opportunity to bring to their attention the fact that these laws in some of its provisions are fast becoming obsolete and thus require urgent amendments.

He stated that it is imperative to note that a bill to amend the Insurance laws has been in the works for some years now, adding that they are optimistic that when the bill is eventually presented to the 9th Assembly, it will enjoy an accelerated attention.

Thomas appealed to the 9th Senate to help the insurance industry achieve its full potentials which will in turn increase contributions to the nation’s economy by passing the bill.

He said: “The Commission indeed needs total support of the National Assembly to be able to regulate the sector better. The sector consists of two major segments namely, the Underwriters which comprise Insurance and Re-insurance companies and, the intermediaries comprising Insurance Brokers, Loss Adjusters and Agents.

He said: “As at date, there are a total number of 55 insurance companies, two Re-insurance, three Takaful and two Microinsurance operators; over 500 insurance brokers and 2,000 agents. The Commission over the years in the course of discharging its duties and keeping to its mandate, had incepted a number of initiatives, especially in the area of market development to boost insurance penetration and growth. While a lot has been achieved by the Commission in this regards, there is a lot to be done if we must attain the desired goals as an industry.

“While the industry is eagerly looking at a more positive outlook in the year 2020 and beyond, it may be necessary to have a peep into the performance of the industry in the last three years especially in the areas of claims payment, gross premium income and total investments. The industry in 2019, had a provisional gross premium income of N490.99 billion; claims of N330.37 billion, premium retention of N376.07 billion and invested N1.13 trillion

“These figures give clarifications especially to the vexed issue of non-payment of claims by insurance operators. There is no denying the fact that there are indeed some cases of delays in the payment of claims by some operators, the Commission is however addressing such cases as soon as they are brought to our notice. It is for this reason that the Commission has strengthened its Complaint Bureau Unit in order to effectively address consumers’ complaints within the shortest possible time. The Commission has also as a matter of deliberate policy adjusted its strategy to focus more on developmental issues than compliance issues going forward in the overall interest of all stakeholders.”

The Acting Commissioner emphasised that the foundation to ensure successful implementation of its initiatives in this regards is being laid.

“Some of the initiatives of the Commission to drive its developmental agenda include but not limited to Recapitalisation; Financial Inclusion (Microinsurance & Takaful); Development of Agric Index Ins., Bancassurance & Retiree Life Annuity; Implementation of Risk Based Supervision Implementation of IFRS 17; Improving efficiency in the supervisory processes; Capacity Building of the Commission and Market workforce and Regional Integration of Insurance Supervision.

“As you may have been aware, the Commission had in 2019 initiated the process to recapitalise the industry in order to upscale its financial standing to meet up with current economic realities and avoid imminent systemic collapse and solvency crisis in the insurance sector. This will ensure that the industry becomes more robust in its technical competence and financial base, build confidence, trust and enhance market value. It is further aimed at repositioning the sector for self-actualisation in terms of growth and development. The process is expected to be concluded by 31st December, 2020.

“In 2009, the Commission launched the Market Development and Restructuring Initiative (MDRI) project aimed at a comprehensive pursuit of development of the industry as well as ensuring full compliance with extant laws in respect of compulsory insurances. The first phase of the project was successfully carried out in all the six geo-political zones in the country.

The second phase of the MDRI project will soon be unveiled and it will mark out clear targets and tasks for all stakeholders in the industry. The Commission is committed to vigorously pursue the continued implementation of Compulsory Insurances to which collaboration and support from all stakeholders is key towards achieving the desired goal.

“In 2009, the Commission launched the Market Development and Restructuring Initiative (MDRI) project aimed at a comprehensive pursuit of development of the industry as well as ensuring full compliance with extant laws in respect of compulsory insurances. The first phase of the project was successfully carried out in all the six geo-political zones in the country.

The second phase of the MDRI project will soon be unveiled and it will mark out clear targets and tasks for all stakeholders in the industry. The Commission is committed to vigorously pursue the continued implementation of Compulsory Insurances to which collaboration and support from all stakeholders is key towards achieving the desired goal.

“In 2009, the Commission launched the Market Development and Restructuring Initiative (MDRI) project aimed at a comprehensive pursuit of development of the industry as well as ensuring full compliance with extant Laws in respect of compulsory insurances. The first phase of the project was successfully carried out in all the six geo-political zones in the country.

I must mention here that the Commission had hitherto been hindered in its various efforts to implement provisions of the current Laws by a number of challenges which are not within its control. We believe that going forward and in view of our renewed collaboration with the National Assembly, relevant security and sister agencies, enforcement of compliance with the laws will become much easier in no distant time.

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