Insurance

Insurers pay N143bn claims as at Q3 2018

From left: President, Chartered Insurance Institute of Nigeria, Eddie Efekoha; Chairman, Nigerian Insurers Association, Tope Smart and Deputy Commissioner for Insurance, Technical, Sunday Thomas at the event.

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Chuks Udo Okonta

Insurance companies have paid N143 billion as claims to policyholders who suffered losses as at the end of the third quarter of 2018, the Commissioner for Insurance, Mohammed Kari, has said.

He said this today at the National Association of Insurance and Pension Correspondents (NAIPCO) workshop, with the theme, ‘End of Year Sector Review/Projection 2019: SIP in Perspective’ at the Civic Centre, Lagos.

Kari, who was represented by the Deputy Commissioner for Insurance, Technical, Sunday Thomas, said the paid claims was a 30 per cent increase from N110 billion reported for the same period in 2017, anticipating that the figure could be higher than N143 billion when the claims paid in the last quarter of the year is added.

He noted that though, this is a good sign that underwriting firms have improved in claims payment, the industry still have pockets of operators that are defaulting in claims, urging underwriters to improve in this regards.

He noted that the Gross premium for the insurance industry as at the third quarter, 2018 stood at N315 billion, a 22 per cent increase over the N258 billion for 2017 in the same period.

He added that The Gross claim figure for third quarter 2018 was N143 billion, a 30% increase over the N110 billion reported for the same period in 2017. We anticipate the final figures for 2018 to be significant indeed.

“The outlook may not be as rosy as we all would have liked but NAICOM sees the silver lining and is fully committed to making the most of it. We have set for ourselves a clear, unambiguous task: to improve the aggregate numbers by enabling individual operators to optimally serve a much larger customer pool with a more varied basket of products. The end game for us is to increase the insurance uptake ratio among the Nigerian populace and we have a number of initiatives in place towards achieving this.

“Financial inclusion is one of the tools we envisage to help us improve market penetration. The initiative is premised on the fact that getting the mass of the financially excluded to embrace insurance in one form or another will have a positive impact. Accordingly, insurance companies are being encouraged to have a buyin into our microinsurance initiatives for the Nigerian market. The Takaful market is still grossly under accessed by the public, there is therefore the need for aggressive promotion in aid of financial inclusion.

“In addition, efforts are being made to expand the distribution channels for insurance products because the traditional channels are becoming too restrictive and suboptimal. Whereas Bancassurance has received the most attention, there are other initiatives to reach out to the public.

“The Commission has developed a guideline for the creation of State Insurance Producers (SIP). It is expected that State Governments participation in enforcement of compulsory classes of insurance will enhance compliance and deeping of the market. States will in the process creat employment and enhance their internally generated revenue,” he said.

He stated further that NAICOM fully appreciates the necessity of having insurers that can safely carry the risks they underwrite, As such Risk-Based Supervision is being adopted as a regulatory tool because it is proactive and addresses the key issues of corporate governance, risk management, capital adequacy and others.
“We are also exploring ways to ensure that insurance companies are adequately capitalized to enhance their risk-bearing capacities. This was the thinking behind the capital initiative of the Commission .

“Achievements of the goal that we have set for ourselves is predicated on the market’s ability to attract business and customers need to have confidence in operators. To this end, NAICOM has championed an industry-wide rebranding project to burnish our reputation, but we cannot do it alone. The support of the media especially those of you here, under the aegis of the National Association of Insurance and Pension Correspondents (NAIPCO), is crucial.”

He however urged the media to help developed the Industry.
“How can the media help us going forward? The agenda-setting role of the media makes it a formidable ally to have for any social engineering effort to succeed. We therefore urge you ladies and gentlemen to partner NAICOM to clear the cobwebs of misconception about insurance among the populace and propagate the necessity and usefulness of insurance in life and in business. Insurance, like any other business needs a positive image. As the regulator, NAICOM issues policy directives and guidelines from time to time; we need all the publicity you can give us on all our initiatives. We appreciate the role of the press as society’s watchdog and we value feedback from you.

“At NAICOM we place a high premium on market information and we are open to suggestions on how we can assist the media perform its role more effectively either by facilitating skills enhancement among media professionals or in any other mutually beneficial way. I would like to reiterate that NAICOM is very much alive to its responsibilities. We seek rewarding partnerships and engagements to enable us successfully meet our goals,” he urged.

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