Insurers set to submit new motor premium rate to NAICOM

Onaolapo

Chuks Udo Okonta

The Wale Onaolapo, Managing Director Sovereign Trust Insurance Plc, led Insurance Premium Rating Committee set-up by the Nigerian Insurers Association (NIA) to determine the minimum rates for different classes of insurance, has completed works on rating of motor insurance which will be sent to the National Insurance Commission (NAICOM) soonest.

 Inspen gathered that the NIA is banking on the support from NAICOM to secure legal teeth for the new rate, which is aimed at eradicating the menace of rate cutting which has being a major setback for the industry. 

Director-General, NIA Sunday Thomas, said aside determining the minimum rates for all classes of insurance, the committee is also charged with the responsibility of recommending sanctions for non compliance with the rates.

Former Chairman, NIA, Olusola Ladipo-Ajayi, once said the menace of rate cutting is one of the dark spots in his tenure.

“I did not succeed in that regard. That is the simple truth.  It is a pity” he said. 

He noted that the industry is its own worst enemy, because operators have allowed competition to driven down prices, adding that with the continuous fall of rates, businesses are now unprofitable.

“We are running ourselves below profitable level due to pressure in the competitive market that is why we cannot grow beyond what we are doing at present,” he added.