The Federal Government has directed the National Insurance Commission (NAICOM) to deepen insurance penetration by making insurance companies develop new insurance products and policies.
Minister of Finance, Budget and National Planning Mrs Zainab Ahmed gave the directive in Abuja when the Governing Board of NAICOM visited him.
She said: “There would be a need to achieve more insurance penetration in the country. In this regard, there is a need to evolve new insurance products and policies.”
The finance minister said: “Members should commit to develop and implement policies that would promote the reputation of the industry through prompt payment of claims. Your target should be to take the industry to greater and enviable heights during your tenure.’’
Chairman, NAICOM Dr Abubakar Sani told the minister that they were “working hard to proffer solutions to curb the ugly trend of insurance failure by way of instituting strong regulatory measures in the Board of directors of all the insurance entities to make them perform better, by adhering to their corporate rules that establish them”.
NAICOM, he added, would “enforce the professional code of ethics among the insurance entities, strengthen their corporate governance, which the board believes will sanitise the market”.
He said the NAICOM Board would soon “revisit the matter of recapitalisation of the insurance industry and clean up its act with the enforcement of code of ethics of insurance profession and practice, and code of good corporate governance in companies”.
In addition, the Board has promised to create an enabling environment “for insurance industry to beef up their capital through mergers and acquisitions, and invitation of fresh capital from the local and international investors”.
“Accordingly, Investors Forum where insurance companies that need capital will interact with potential investors: insurance companies will come together to showcase themselves where there will be due diligence to enable potential investors to know their financial status”.
The chair appealed to the minister to support their effort to look “for investors that would make the Nigerian insurance industry robust to effectively strengthen the entities to play their roles in making other businesses thrive in the country”.
To this end, Sani said: “NAICOM will organize an insurance investment forum in Nigeria and abroad with the sole aim of wooing potential investors to take advantage of the potentials in investing in Nigeria Insurance Industry”.
The Board, he noted, would seek the collaboration of Nigerian Investment Promotion Council, National Assembly Committee on diaspora, and other insurance jurisdictions across the globe. We want to extend our investment campaign to Europe, the Middle East and America.
The NAICOM Board Chairman said the Commission “is working to sanitize the market, and will be taking out companies that are not measuring up to expectations.
According to him, “we will install the mechanism to review all the actuarial valuations submitted to the commission for assessment and consideration”.
In order to enhance the performance of the regulatory body, Dr Abubakar Sani said NAICOM‘s “strategic plan will be reviewed to align with the objectives of the commission as contained in the matching order and directives; where The Minister specifically asked the Board to uplift the insurance industry to a greater height, on the day our Board was inaugurated”.
He also asked for the minister’s support “to exterminate the menace of fake insurance policies in the country, which deny huge revenue to the insurance entities and taxes to the government”.
“In our action plan we will solicit the cooperation of your ministry to institute an insurance task force that would enforce compulsory insurance in the country.
“The task force that will be deployed, should be made of the Police, Vehicle Inspection Officers (VIO) and Nigerian Civil Defense” he said.
Abubakar Sani assured the minister that NAICOM will build a strong, viable and 21st century insurance industry in Nigeria. That is in addition to deepening insurance in the country, and “raise positively, its contribution to the domestic gross product in the Nigeria economy”.