NAICOM unsettles errant operators

NAICOM unsettles errant operators

Chuks Udo Okonta

The fear of the Commissioner for Insurance Fola Daniel has become the beginning of wisdom for insurers in recent times as they run for cover at the mention of his name.

Findings by Inspen revealed that most operators who have over the years thrived on unethical practices, now have sleepless nights, as companies that were once untouchable have been hammered by the Daniel led National Insurance Commission (NAICOM).

Observers said the Commissioner; in his first four years administration was mild to the operators and has now risen to put to a halt to limitations that have held the industry down. They lauded the new twist by the commission, adding that the present move would help put the industry in the right footing.     

The commission, early in the year dropped its harmer on brokering firms that failed to comply with the industry’s rules. It urged the public not to transact businesses with them until they are let lose of its hook. The affected firms are, ADS Insurance Brokers Limited,  APL Insurance Brokers Limited, ASO Solid Insurance Limited, Bambi Insurance Broker Limited, CIB Insurance Broker Limited, Cachet Insurance Brokers Limited, Clown Field Royal Insurance Limited, Cobal Insurance Brokers, Col-Val Insurance Brokers, Commercial Marine Brokers, Consolidated Insurance Brokers, Corporate Trust Insurance Limited, Delight Insurance Brokers Limited, Fair Deal Insurance Limited, First Cover Master Broker Limited, Goodgate Insurance Limited, Hope equity & Trust Brokers Limited, I B P C Insurance Brokers Limited, Inland Insurance Brokers Limited, Ma Aji Insurance Brokers Limited, Mark of Security Insurance Limited, Mbc Insurance Brokers Limited, Mecartend Insurance Brokers Limited, Megatech Insurance Brokers Limited, Multi-Lateral Insurance Brokers, Risk Guard Insurance Broker Limited, Royal Trust Insurance Brokers Limited, Shield Insurance Broker Limited, Tulip Insurance Brokers Limited, Uni-Chartered Insurance Brokers, Unimag Insurance and United Modern Insurance Brokers.

For failure to comply with the Money Laundering Act, 46 firms were also sanctioned by the commission. NAICOM, in its Gazette on Anti-Money Laundering/Combating Financing of Terrorism (AML/CFT), urged insurance operators to be wary of any policy holder who insists on anonymity, reluctant to provide identifying information, or providing minimal and seemingly fictitious information. Other things insurers are to watch are frequent policy surrenders by policy holders, payment of premium and tops ups over and above N500, 000 per person policy.

NAICOM said: “A suspicious transaction may be defined as one which is unusual because of its size, volume, type or pattern or otherwise suggestive of known money laundering methods. It includes such a transaction that is inconsistent with a policy holder’s known legitimate business or personal activities or normal business that lack obvious economic rationale.

“Operators should be wary of a request for a purchase of a policy in amount considered beyond the apparent need of the policy holder, frequent policy surrenders by policy holders, policy from a place where he does not reside or is employed, unusual terminating of policies and refunds, frequent request for change in address. Others are borrowing the maximum amount against a policy soon after buying it, inflated or totally fraudulent claims and overpayment of premium with a request for a refund of amount overpaid.”

The commission’s harmer also dropped on Alliance & General Insurance (A&G) Plc, A&G Life and Fidelity Bond for infractions ranging from non-rendition of accounts; misrepresentation and non-disclosure of liabilities; non-remittance of premiums and commissions, and corporate governance abuses.

Daniel said NAICOM received 86 claims complaints this year, out of which 52 have been resolved and the claims about to be paid. He said the protection of policyholders’ interest will remain paramount during his administration.      

He said: “Our sanctions are largely remedial. What is upper most in sanctioning an insurance company is the protection of policy holders. If I sanction an insurance company and put it on the papers of newspaper, without obtaining a remedy, how does that help the policyholder?  But if I can effectively sanction an operator and the interest of policy holder is fully served, that mean we are doing the right thing. I assure you that we are not sweeping anything under the carpet or shielding any operator. As a matter of fact in the last three months, I think there has be shout and cry from the industry about our sanctions we have given to errant operators. We are acting as it become expedient and appropriate; we are not going to mimic any regulator so that the public will say we are doing something that would not be necessary.”