From left: Deputy Commissioner, Technical, National Insurance Commission, Thomas Sunday; President, Chartered Insurance Institute of Nigeria, Mrs Funmi Babington-Ashaye; Managing Director, Financial Institutions Training Centre, Dr. Lucy Newman and Managing Director, B. Adedipe & Associates, Dr. Biodun Adedipe at the event.
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Chuks Udo Okonta
One month after the National Insurance Commission (NAICOM) issued the revised microinsurance guideline, only one insurance company had applied for national microinsurance licence, Inspenonline has learnt.
The Deputy Commissioner, Technical, NAICOM, Thomas Sunday; said this yesterday at the Chartered Insurance Institute of Nigeria (CIIN) 2018 business outlook seminar, in Lagos, adding that the commission had also received applications for state and unit microinsurance licences from many investors.
It was gathered that some conventional non-life insurers are eyeing life microinsurance licence, while life operators also want non life microinsurance licence to expand their operations.
According to the guideline issued by NAICOM last month, a National Insurer, who seek composite micro insurance licence, is expected to be capitalised to the tune of N600 million, while N400 million minimum capital base is needed from a General micro insurance and N200 million for a Life operations
It noted that national operators are allowed to have presence in at least six states within the three geopolitical zones of the federation.
For a State Microinsurer, the minimum capital base is pegged at NI00 million, broken into N60 million for general and N40 million for life operators. The regulator also expects such underwriter to operate only in one State of federation with at least three branches or office locations, each in a different Local Government Area.
A Unit Microinsurer investor, must be capitalised to the tune of N40 million, N25 for general business and N15 million for life, with operation in one location within a local community.
The regulator, has therefore made it mandatory for these micro insurance outfits to make themselves visible and must be seen to be serving the low income earners grassroots.
NAICOM, had in the guideline mandated the 17 insurance firms selling microinsurance products through the window operations to acquire fresh licence within a period of 18 months.
The regulator noted that in a case any of the concerned insurance firms failed to acquire fresh license, those with non-life Microinsurance products should wind up their operations, within 18 months while those with life classes should not later than 24 months transfer the life classes to dedicated Microinsurance company within this period.
NAICOM, in section 10, sub section 1 and 2 of the revised Microinsurance guidelines released recently to the public said:”Existing Conventional microinsurers shall wind down their window operations for non-life classes within 18 months from the effective date of this Guidelines and in not later than 24 months transfer the life classes to a dedicated microinsurance company.”
It added that, ‘no policy shall be renewed nor new one issued with an expiry date beyond the date stated above.’
By this directive, non-life conventional insurers operating Microinsurance as a window operation are given till June 2018 to wind up this operation while the life operators has December 2018’as the deadline to do same.