The National Insurance Commission (NAICOM) recently organised a two-day seminar for insurance journalists and business editors in Kano, to keep them abreast with the plans of the commission, as well as strategic plans and programmes for 2020 and its 2019 scorecard. EDET UDOH reports.
NAICOM seeks more support
In his keynote address, the Acting Commissioner for insurance, Mr. Olorundare Sunday Thomas, commended the efforts of the journalists for publicizing the activities of the commission in particular and that of the industry in general and solicited for a sustained mutual working relationship between the journalists, the Commission and the industry just as he charged the journalists to always be objective in their reporting in order to project the image of the industry in a positive way.
The theme of the seminar was “Strategic Focus of the Commission in the year 2020; from Compliance to Development.”
According to Thomas, “The commission as always must commend your contributions and support in the preceding years while also looking forward to a better working relationship and continuous collaboration with you on a sustainable basis. Your efforts in reporting the initiatives of the Commission and other information that have impacted positively on the image of the insurance industry is commended and well appreciated.”
2019 in review
In reviewing year 2019, the Acting NAICOM boss said, “The year 2019 obviously had its low and high moments, benefits and turbulences. Apparently, we all experienced its positive and negative consequences, leaving us with the bitter-sweet lessons that will ultimately shape our decision making in this and subsequent years.”
He said the theme for the seminar “Strategic Focus of the Commission in the year 2020; from Compliance to Development” is apt and timely as NAICOM is shifting focus from compliance issues to emphasise more on its market developmental responsibility.
2020 in perspective: Recapitalization in focus
Thomas said as the year 2020 continues to unfold, giant strides will be made by the commission in all aspects of its statutory responsibilities, positing that “this is the time to put the past behind us and look forward to a better and more vibrant sector.”
He reminded the industry stakeholders that “the task of building an insurance sector of our dreams is a collective one and thus, all hands must be on deck to ensure our dreams become realities.”
He added, “We recognise the impact of conducive work environment to effective and efficient regulatory system and this will always remain our priority.”
The NAICOM boss said that the second phase of the Market Development and Restructuring Initiative (MDRI) would soon be unveiled and it will mark out clear targets and tasks for all stakeholders in the industry.
He said going forward, the commission shall vigorously pursue the continued implementation of Compulsory Insurances in every nook and crannies of the Country.
According to him, “We are certainly not unaware of the challenges inhibiting the successful implementation of these classes of insurance thus far hence, our resolve to work with relevant stakeholders to ensure a seamless drive.
“Indeed, the successful implementation of compulsory classes of insurance across the nation will ensure adequate protection of our strategic National Assets. We will be working with the relevant security agencies to guarantee effective and efficient monitoring of compliance,” he stated.
On the ongoing recapitalization exercise, Thomas said that the initiative to recapitalise the insurance sector is no longer news, noting that the essence of the recapitalisation is a move to ensure that the industry becomes more robust in its technical competence and financial base, building confidence, trust and enhancing market value.
Financial inclusion mechanisms
Thomas said that the financial inclusion strategy has been central to the Federal Government developmental plan and the Commission has over the years invested hugely in the development of financial inclusion mechanisms which includes the introduction of Microinsurance and Takaful Insurance products.
The introduction of these lines of insurance, he said, is intended to deepen the penetration of insurance in the country and bring into the fold majority of the populace that are hitherto excluded. “So far, some milestones have been recorded in this regard with three standalone Microinsurance and four Takaful insurance companies already granted approvals.
“The Commission shall continue to deploy more energy and resources in building public trust and confidence in insurance despite years of poor perception. In this regards, your optimum support is required as whatever you write or report about the industry will go a long way in building or destroying the fragile image of the sector,” he posited.
Annuity business and the future of insurance
On annuity business, NAICOM boss informed the gathering that the annuity business made headlines recently with a boost in the contribution of the business to the sector, adding that the public is becoming more exposed and knowledgeable about the workings of Annuity even as he said that the future of annuity business is looking very bright for the business which he said has also shown a positive growth in trust and confidence in the sector.
Insurers’ financial soundness, viability
Thomas assured of the Commission’s commitment to ensuring financial soundness and viability of the insurers and the adequate protection of policyholders at all times, stating that these will continue to be part of NAICOM regulatory priorities.
“We will continue to ensure that genuine claims are promptly paid while also ensuring a reasonable protection of investments of shareholders.
“In demonstrating its willingness to protect the policyholders, the Commission has further strengthened its Complaint Bureau Unit to respond to public complaints over claims settlement. Available statistics have shown that there have been great improvement in this area.
“Ensuring the right pricing of insurance products and effective deployment of technology for ease of transaction are among the key areas the Commission will be emphasising this year.
Need for digitalization of insurance operations
Digitalisation of insurance business is no longer an option, but an imperative which we all have to work towards its actualisation.
“As we may all be aware, the industry is currently lagging behind other financial services sectors in this area. The Commission is working vigorously to see that all its operations are digitalised.
The year 2020 is a year for us to turnaround the fortunes of the industry and this cannot be accomplished without digitalising our processes and encouraging the industry to imbibe same.
Strategic plans for 2020
The theme paper presenter, Deputy Director/Head Research, Statistics and Strategy Directorate, Adewale Motajo, gave details on the Commission’s strategic plans for 2020 and its 2019 scorecard.
He said the Commission’s strategic focus in 2020 is guided by internal and external factors impacting its operating environment, aligned with developmental priorities of the Federal Government.
He said the Commission will continue to give attention to recapitalization of insurance and reinsurance companies; effective administration of Retiree Life Annuity and Group Life Assurance; Market Conduct Guideline; International Financial Reporting Standard (IFRS 17).Other NAICOM’s focus in 2020 are: Launch of the NAICOM Portal; Risk Based Supervision (RBS); Regional Integration; development of Agricultural Index Insurance; market development ; Actuarial Capacity Development; Financial Inclusion (Micro-insurance); Financial Inclusion (Takaful); Bancassurance Authorization and AML/CFT.
On the Commission’s achievement in 2019, according Motajo, included issuance of circular on new Minimum Paid-up Share Capital; Financial Inclusion Initiatives: Approval for: (a.) two Micro-insurance companies and (b) Two new Takaful companies; Championed West African Regional Integration; Finalized the Code of Corporate Governance (adaptation of the National Code).