Nigeria Insurance Regulator Revises Guidelines on Bancassurance
The National Insurance Commission (NAICOM) on Friday rolled out revised guidelines on Bancassurance. Mr Jide Orimolade, Chairman Media Subcommittee of the Insurance Industry Committee (IIC), said this at a news briefing at the end of the 13th IIC meeting in Lagos.
Orimolade, also Chief Executive Officer (CEO) of Stanbic IBTC Insurance, explained that the new guidelines would allow insurance companies partner with many banks, rather than dealing with only one bank at a time.
“This would disable exclusivity, which is also in line with the Central Bank of Nigeria’s regulation that prescribes that a commercial bank cannot propose the product of only the insurance company they were partnering with to a consumer.
“Banks are expected to also present products of other insurance companies as well,” he said.
According to him, the new guidelines were laudable and would ensure fair play by operators in the insurance market. Orimolade stated that work was in progress to review the share capital of the microinsurance segment in terms of market development as proposed by an IIC subcommittee.
He noted that the regulator, through the Commissioner for Insurance who doubles as the Chairman of IIC, also charged CEOs of insurance companies on prompt claims payment.
The subcommittee chairman said the commissioner noted that the law empowered the commission to suspend or cancel the licence of defaulting underwriters.
He stated that Sanlam Insurance, the lead underwriter for the COVID-19 insurance covers for health workers, had settled all pending claims, which was a positive development for the industry. Orimolade said: “In terms of claims that have been paid so far, it has gone to show that we have the muscle to pay claims and on time too.
“There will be renewed activities in terms of claims payment and the commission will be involved in monitoring the activities and performance,” he said. In terms of the proposed increment of the premium for the third-party motor insurance policy, the subcommittee chairman explained that there were processes for increasing the rate.
He said the process for the revised premium rate for the third-party motor insurance policy had reached a point of approval by the Governing Board of NAICOM. Orimolade stated that following the board’s assent, the draft approval would be forwarded to the Minister of Finance for concurrence.
“Until then, the proposed amount for the policy cannot be disclosed because the minister cannot be preempted,” he added. On the International Financial Reporting Standard (IFRS -17), Orimolade noted that insurance companies were expected to prepare their financial statements in compliance with the IFRS -17 from Jan.1, 2023.
He said while there could be issues to address, the insurance companies were ready for the IFRS-17. Concerning the Insurance Bill 2020, Orimolade said the bill had been scheduled for presentation on the floor of the National Assembly and hopefully would be released before the end of the year.
The subcommittee chairman, speaking on the NAICOM portal, stated that the regulator adjudged that about 90 per cent of insurance companies had complied with turning out their reports on the portal.
On annuity, he said NAICOM charged operators to see the opportunity in the annuity business, being a growing product in the insurance market. Orimolade said the regulator would present the report of its assessment of the performance of insurance companies on Risk Based Supervision (RBS) before the end of the month.
Assessing the industry for the outgoing year, the Head of Corporate Affairs and Market Development, NAICOM, Mr Rasaaq Salami, noted that the industry had not done badly, as there had been lots of positive activities within the industry.
“Lots of indices are looking upward for the industry this year, which is very encouraging because of a number of factors, such as the IIC meeting. READ: Stanbic IBTC Expands Services with Life Insurance Subsidiary
“The IIC is a meeting point for regulators and operators to resolve issues and also come up with common processes and objectives on what should be done.
“This has helped in improving the performance of the industry and gradually reducing friction between the regulator and the operators.
“We hope that the situation will be maintained in the coming years, “he said. #Nigeria Insurance Regulator Revises Guidelines on Bancassurance
