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| Soladoye |
A dinner organised for members of the Governing Board of the National Insurance Commission(NAICOM) and selected chief executives of insurance formations was hijacked by trade groups in the industry to make several demands on the commission and government. Nnamdi Duru who was at the dinner reviews some of their demands.
Following the appointment of the Hon. Chibudom Nwuche led Governing Board of the National Insurance Commission (NAICOM) by the Federal Government, the commission convened a meeting between its board members and selected chief executives of insurance formations.
The meeting was part of efforts to enable the board members know more about some of the developments in the industry and get first hand information and feedback on insurance regulations from operators.
Different trade groups in the industry lent their voices to discussions on how to grow the insurance market with a view to making insurance contribute meaningfully to the country's Gross Domestic Product (GDP) and presented several demands on NAICOM and government.
Their demands included: bail out for insurers; review of restrictions on investments; and recognition of offshore investment; as well as protection of policyholders, particularly clients of some liquidated companies life companies. Insurers Demand Bailout
One of the key demands by insurance and reinsurance companies in the country was that Federal Government should extend bail-out to them in the spirit of recent interventions in the different arms of the finance industry.
They observed that it amounts to injustice and insensitivity on the part of government for it to bail out intermediaries in the Nigerian Stock Exchange (NSE) including stock brokers and banks who lost little resources to the market crash leaving out insurers who suffered huge losses in their capacity as corporate investors and risk bearers.
"Many insurance companies are still groaning from the losses suffered as a result of the crash in the stock market. Recovery has been difficult and returning to profit a herculean task. We appeal to the Federal Government to look towards the direction of insurers in this regard," the Chairman of Nigerian Insurers Association (NIA), Mr. Remi Olowude said.
Encroachment on Insurance Business NIA also asked the Federal Government to stop the encroachment on insurance businesses by some of it agencies, particularly those trying to provide insurance protection to aviation passengers and public liability for nuclear risks. The association lamented previous encroachments including the extraction of workmen's compensation insurance, severance of pension business and transfer of health insurance business to the National Health Insurance Scheme (NHIS).
It alleged that "NCAA, under the Ministry of Aviation, is planning to establish insurance fund for aviation passengers' liability," saying all over the world, aviation passengers' liability is subject to international conventions and the risks are covered by conventional insurance policies and Nigeria would not be an exception.
"Similarly, the Nuclear Agency wants to establish fund for nuclear damage insurance, instead of seeking conventional insurance cover for the risks which are covered in international insurance market," Olowude said.
Restrictions on Investment The insurers' association also called for a review of restrictions on investment to ensure safe but adequate returns to stakeholders for the viability of the industry. They want the provisions of Insurance Act, 2003 and Regulation of Insurance Company Investments amended to reflect modern realities.
"Investments on equities suffered losses in 2008 and 2009, yet insurers are expected to maintain the same proportionate level of investment in prescribed sectors," they complained. The insurers equally want a review of NAICOM's position on off-shore investment for the purpose of solvency calculation and actuarial valuation. Currently, off-shore investments are not recognised in the calculation of solvency margin for insurers.
Compulsory Insurances The essence of compulsory insurances is to ensure that innocent victims of accidents and disasters are fully compensated and to minimise economic waste in the society. The insurers demanded that in addition to making compliance with group life assurance a requirement for bidding for public sector contracts, NAICOM should prevail on government to make compliance with compulsory third party motor insurance a condition for contract bidding too.
They also prevailed on NAICOM to activate various laws relating to Marine Insurance of refined petroleum products imported into the country since the Insurance Act, 2003 provides that all imports into the country must be insured with an insurance company registered in Nigeria.
"This law is only observed in the breach. We are seeking enforcement of the Cabotage Act, 2003, review of the Insurance Act, 2003 and the Nigerian Oil Industry Content Development Act, 2010," NIA insisted.
Statutory Deposits and Multiple Taxes NIA appealed to the commission to review its policy on statutory deposit. The NIA chairman pointed out that banks and other financial institutions do not keep part of their capital with the Central Bank of Nigeria (CBN), lamenting that 10 per cent of insurers' capital is lying idle at the apex bank.
"This fund could be used to grow the companies, invested in other instruments for higher returns for the benefit of stakeholders in the company as against keeping it in the CBN without any agreement on interest payment," he appealed.
Insurance operators also want the Companies Income Tax (Amendment) Act, 2007 revisited with a view to correcting the absurdities in the provisions which made the statutes inimical to the growth and development of insurance industry in addition to addressing the imposition of multiple taxes on insurers by various tiers of government.
Review of Claim Procedures Led by Chief Yemi Soladoye, the Insurance Consumers Association of Nigeria (INSCAN) asked NAICOM to look for ways to better the lots of insurance consumers across the country.
He asked the commission to review aspects of insurance law that allow an insurer up to six months to repudiate an insurance contract and another six months to repudiate claims while an insured who paid premium for the cover at the beginning of the contract and lost his only means of livelihood, only car or his widow and children suffers untold hardships.
"NAICOM should as a matter of urgency issue market conduct directives to its operators to bring the period for payment of our claims to not more than 30 days. It should also give proper interpretation to sec 70(c) of the act and note that there should really not be any outstanding claim for more than 90 days in the books of any underwriter.
"This is the only way that NAICOM can claim success, within the context of its duty, in the implementation of section 50(1) of the Insurance Act 2003, Soladoye stressed.
Customers of Liquidated Life Companies Falling back on the provision of Section 83(i) of the Insurance Act 2003, stipulates continuation of the life assurance business of insurer in liquidation to be transferred as a going concern, insurance consumers demanded to know the where about of their investments in liquidated life insurance companies.
They cited the case of Spring Life Assurance where thousands of our members have benefit advice of over two years not paid by the company and Amicable Assurance whose policyholders are still looking for their life savings 10 years down to reinforce their demands. They noted that out of the 23 companies that emerged as general business insurers post consolidation, 17 were composite companies and queried "where are these life portfolios transferred."
"NAICOM should mandate all the companies that acquired or merged with others by 2007 to make uniform publications (at least four times) to inform the public of the where about of their former underwriters. It is only by so doing that NAICOM would be protecting the policyholders in Nigeria in the manner that is most beneficial to them," INSCAN demanded.
The trade groups that attended the programme included: Nigerian Insurers Association (NIA) representing all the insurance and reinsurance companies in the country and the Nigerian Council of Registered Insurance Brokers (NCRIB).
Also the Institute of Loss Adjusters of Nigeria (ILAN), Risks and Management Society of Nigeria (RIMSON), Association of Registered Insurance Agents of Nigeria (ARIAN) and the Insurance Consumers Association of Nigeria (INSCAN) attended the dinner
Source Thisday
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