Insurance

NAICOM charges insurance consumers to report claims defaulters

Kari

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Chuks Udo Okonta

The National Insurance Commission (NAICOM) has called on insurance consumers with genuine unsettled claims problems to channel their grievances through its Complaint Bureau Unit (CBU) which has been upgraded to attend to aggrieved consumers.

The Commissioner for Insurance, Mohammed Kari, disclosed this, whilst responding to an allegation by Dangote Group that some insurers have refused to settle its N400 million claims since 2012.

According to Kari, the Complaint Bureau Unit has been upgraded and is now headed by a Deputy Director in the commission. He expressed misgivings over Dangote’s refusal to report the alleged insurance firms.

“The Commission had signalled the issue of effective and efficient service delivery to consumers as a key priority with its establishment of Complaint Bureau Unit to deal with complains from members of the public against any insurance operator. This Unit had recently been upgraded and is headed by a Deputy Director to attend to aggrieved consumers.

“Many aggrieved consumers have continued to access this desk to register their complains with us. We advise you to take advantage of this desk and report your challenges to us and I assure you that any company found in default shall be compelled to do the needful,” he said.

Kari, was also not happy with insurance consumers over some practices that are not in psych with insurance rules. He accused some consumers of connivance with insurance Brokers to allot proportion of risk to local underwriters without due cognisance of the insurers’ capacity, preferring to place risk abroad even when the local market is not saturated.

He also alleged that some consumers also in alliance with intermediaries chose to exclude some underwriters from participation in underwriting certain risks without cogent tenable justification.

“However, the Commission in recent time have noticed certain behaviours and actions of consumers that are not in psych with this believe which is detrimental and dangerous to the insurance industry in Nigeria.

“The Commission frowns at these practices and want to use this medium to inform such consumers to desist from the practices as they run counter to our regulations. Where we have noticed such practices, we have rejected applications from operators for approval to cede such risks abroad. This action of the consumer/broker sometime leads to delays in placement of the risk even when the insured has paid its premium to the intermediary. While the Commission is not averse to ceding of risk offshore, it must be done only when the local market has taken the much its capacity would allow,” he said.

Other areas, according to him, where the Commission has issues with the insurance consumers are in: Direct involvement of the insured with reinsurance placement of their Insurances, stressing that once the consumer places his risks with the Insurer, whether direct or through a broker, he or the broker has no role in the placement of the reinsurance.

“On this note, I would like to remind consumers that the Nigerian Insurance space should only be occupied by Insurance institutions licensed and regulated by NAICOM. We would not accept insurances placed through a non licensed operator in this market,” he added.

He was also unhappy with delays in submitting evaluation results of bidding processes to the Commission, adding that delays by the insured in issuing placement/ renewal instruction to the insurer makes it impossible for the Insurer to meet the application period for the placement of excess risks offshore where applicable.

“The emerging practice of supposed premium funding by local brokers on behalf of the insured.

“These are trends that are not only dangerous to the insurance industry but also to the consumer. We ask you to desist from these practices because they are neither in your best interest nor that of the insurance operator and of course, that of our nation. We also crave the understanding and cooperation of the consumers to ensure compliance with our laws and regulations particularly the Insurance Act 2003 and the Local Content Act,” he said.

Kari noted that good understanding between all stakeholders can only make NAICOM more effective in its role of protecting the insurance consumer.

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