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Chuks Udo Okonta
The National Insurance Commission (NAICOM) would grant operating licence to more insurance and reinsurance firms that show and have capacity to impact the underwriting sector, the Commissioner for Insurance, Sunday Thomas, has said.
Thomas said this during an interview with Inspenonline at the sideline of the recently held African Insurance Organisation annual conference in Nairobi, Kenya.
He noted that the commission would continue to encourage the development of the insurance sector by ensuring that capable players are welcomed into the sector.
The NAICOM helmsman said insurance and reinsurance firms licenced over a year ago, were granted approval due to their capacity to impact the sector.
“The last reinsurance company that was approved in Nigeria before we approved FBS Reinsurance, was approved more than 10 years ago. Also with insurance companies like Heirs and Enterprise.
“These companies were not approved because of their numbers, but we looked at the profile of the people behind them and their success rates. We believed they have the ability to impact our sector. I will be happy tomorrow, if I see anyone that has the capacity to impact our sector, I will approve the licence,” he submitted.
Thomas also spoke on the alleged foreign dominance of the insurance sector, stating that the allegation is unfounded, as Nigerians own most of the firms in the sector.
“The issue of foreign dominance should be put in the right perspectives. In terms of ownership, that may not be correct. But in terms of some level of operations, that may be right. For example, on special risks, rates are still determined abroad. But in terms of ownership the companies are owned by Nigerians.
He noted that though there are some foreign interest coming in, but that is not enough to tag them dominant factors.
On deepening insurance penetration, Thomas maintained that NAICOM would continue to encourage insurance practitioners to explore opportunities in the retail market space.
He said efforts would also be intensified to create awareness on benefits of insurance, stressing that the people need to know more on the benefits of insurance.
“We need to encourage and mop up individual lability. Another thing is that we have not been able to communicate the benefits of insurance to the public. Why should we be raising money for relations when a member of the family dies? That would have been done through insurance. We must begin to tell people about insurance. That would be the game changer,” he posited.
Thomas said the industry is working assiduously to ensure the sector parades robust data that would reposition its operations. He commended African Reinsurance on what it is doing in the area of developing the sector’s data.
“Africa Re, is funding the second phase of NAICOM portal and it is also supporting many other markets across the continent on data. When we are done with the ongoing works, they would amount to a robust data,” he submitted.
The Commissioner noted that a lot has been achieved in the 50 years existence of the AIO, adding that to a large extent, in respect to conduct and nature of insurance, there is great departure from the position in the past.
He maintained that in terms of operations there is huge success compared to the position of the industry 50 years ago, stressing that modernization; technology; human capital; development capital and more have been entrenched in the industry in recent time.
He added that in terms of products availability, a lot of products have been developed in line with needs of consumers and in the area of regulation, a lot of the industry’s laws have been reviewed in the last 50 years, which could reflect modern day reality.
According to him, the various insurance markets within the continent, have also worked well with their governments to reposition insurance business in the past 50 years. He noted that insurance markets across the continent have benefited from government’s policies.
According him, all the compulsory insurances that are now low hanging fruits were given to the industry by the government. He added that a lot of things are going on at different levels as regards insurance in the continent, stressing that countries are changing their insurance laws, stressing that though the process may be slow, the sector is making tremendous progress.
