Apparently moved by the success recorded in the past one year of his administration, the Commissioner for Insurance/CEO, National Insurance Commission (NAICOM), Olorundare Sunday Thomas, has indicated his desire to drive insurance penetration and market development in the country to play it’s proper role in the economy.
Speaking at the backdrop of his one year in the helms of affairs of the Commission, he promised to bring insurance services to all nooks and crannies of the country.
According to him, the Commission has rolled out a five-point strategic plan as spring board to realise the target objectives.
For instance, the 2021-2023 Strategic Plan has five goals designed to entrench effective and efficient service delivery, ensure safe, sound and stable insurance sector, adequately protect policyholders, and public interest, improve trust and confidence in the insurance sector and encourage innovation and promote insurance market development.
He disclosed that N9.2billion was set aside as group life premium for 2021-2022 cover for federal civil servants and para-military, while the level of insurance participation in pension matters received a boost. Joint guidelines was issued by the Commission and National Pension Commission (PenCom). The pension reach for insurers was achieved by the joint action of NAICOM and PenCom.
The oil and gas sector is critical to insurance industry “There is a guideline in the works that will seal the leakages which hitherto made it difficult for the local content to make a mark for Nigerian participation. He assured that the law on Nigerian content will receive a boost from the guidelines, which no doubt will increase insurance participation in this area.”
“We also know that with the engagement we have had with the Nigerian content, there is going to be an increase in the oil and gas business. As I speak now, we have a committee working on the guidelines to enforce the law in the Nigerian content. All the leakages we have had hitherto will be blocked”
On the need to expand the basket the NAICOM boss said, two Takaful insurance companies have been licensed in addition to the existing two, adding that the Commission is conscious of the fact that insurance sector is knowledge based which informed that there is on going development of more actuarial analysts capacity in the industry as the first step of having more qualified actuaries in the country.
“We know that the drivers of the economy are those at the lower levels of the pyramid and so we are taking financial inclusion very seriously. It is now a national policy. For the insurance sector we are far behind but we are doing a lot of catching up. To this effect, four micro-insurance companies have been licensed and an additional two are on the verge of being licensed”
Insurance as technology driven business, achieved a feat during the period under review. The Commission successfully completed the first phase of its portal. The portal started nine years ago, but until last year, nothing was happening. Today, the functioning portal is already up and running.
“The traditional method of distributing insurance is becoming outdated and inadequate to achieve the speed and the people we want to reach we must begin to develop other channels. There are few of them that have been developed that are waiting for final touches before being released”.
In an attempt to increase insurance penetration in the country as well as increase government participation in insurance business, Thomas said the Commission is currently engaging state governments to draw them closer and bring the gospel of insurance to their door steps. In the last one year, some states governors have been visited by the Commission, he said.
The CFI said the need to think outside the box is essential if insurance industry in this country should move further, “The traditional method of distributing insurance is out dated. So, the Commission is exploring other channels and will soon develop modern and effective channels, “We must begin to develop other channels. There are few of the channels that have been developed. We are waiting for final touches for them to be released”.
In ensuring the safety and protection of the sector, Thomas said that corporate governance become effective in the industry, from June 1, 2021.
In a bid to improve human capacity development, plans are almost completed to set up an Academy in the risk bearing industry. Already, the Commission has acquired a property for it and is currently being worked on adding, “we are believing by the end of the third quarter or beginning from the fourth quarter 2021, NAICOM Academy will take off”.
The Commission is set to grow life and non-life insurance businesses as never before, Thomas emphasized. As part of this, NAICOM is exploring ways of attempting to enhance insurance development and growth through the operators’ participation in policy formation.
In the next two months, NAICOM will be ready to implement Risk-Based Supervision policy, according to the Commissioner “the relevant persons have been trained, the necessary skills acquired and the instrument that will enable the implementation, have been developed. Risk-Based Supervision policy is a system in which the supervising authority NAICOM will allocate time and resources to companies based on the level of risk inherent to their balance sheets.
On the enforcement of compulsory insurance, the Commissioner stated that NAICOM has embarked on various engagement measures across the country. Aside from visiting state governments to solicit for their support, NAICOM is also working in collaboration with the Federal Road Safety Corps, Federal ministry of transportation, Federal Fire Service, among others.