The Nation Newspaper

Category: Insurance

  • AXA Mansard observes Breast Cancer awareness month

    AXA Mansard Insurance Plc, a member of AXA Group, has  observed the just concluded Breast Cancer Awareness month.

    In a statement by the firm, Breast Cancer Awareness Week, which is observed around the world in October, is an annual international campaign organised by major breast cancer charities to increase awareness of the disease.

    The week is also used to raise funds for research into its cause, prevention, diagnosis, treatment, cure and offers information and support to those affected by the disease.

    AXA Mansard Health Limited Chief Executive Officer, Tope Adeniyi, said there has not been any sure way to prevent breast cancer yet.

    He said: “This is why it is so important to conduct regular screenings. Women need to talk to their doctors on the benefits of screenings and self-Breast examinations and risk factors. It has become increasingly important for women to be active participants in their breast health.

    “There are about 1.38 million new cases and 458,000 deaths from breast cancer each year. Breast cancer is by far the most common cancer in women worldwide, both in the developed and developing countries. Majority of deaths occur in low- and middle-income countries, where people are diagnosed at late stages mainly due to lack of awareness on early detection and barriers to health services. Early detection is critical to survival. It is, therefore, important to educate both men and women about the importance of early detection, and critical conversations about appropriate screenings with their healthcare provider.

    “To emphasise and highlight the increasing importance of early detection and screening, AXA Mansard carried out a number of activities, including a breast cancer awareness talk, breast self-examination training, nutritional assessment and, general wellness screening in the month of October.  At AXA Mansard, we remain at the forefront of health maintenance and continue to strive towards making a difference in the lives of people as we join in the fight against breast cancer. We remain resolute in making the world a healthier place.”

  • Chinese insurance market to become new giant

    Experts unanimously agreed that China will be the world’s largest insurance market by 2028.

    Over the next decade, China will unseat the United States (US) in terms of premiums, a report by Atlas Magazine, has shown.

    With $1377 billion, or more than 28 per cent of the global turnover, the US is the largest insurance market.

    In 2017, life insurance turnover decreased in mature markets (-4per cent in the US, -0.7per cent in the United Kingdom (UK), -2.7per cent in France, -6.1per cent in Japan), regions that generate 45per cent of the global turnover.

    On the other hand, during the same period, emerging markets reported significant growth in life insurance (China +21per cent, India +17.4per cent, Indonesia +30.8per cent, Malaysia +8.3per cent, Thailand +8.7per cent, Philippines +4.4per cent). The Chinese market alone accounts for 72per cent of the overall premiums of all afore-mentioned markets.

    With current growth rates maintained in both life and non-life insurance, China is expected to take the lead in the coming years.

    This performance did not go unnoticed by its first economic rival, the US, which indulged in a commercial standoff with the middle empire. Regulatory changes and the ensuing political tensions will certainly impact an industry characterised by its universal nature.

     

    • Culled from Atlas Magazine

  • NAICOM urges collaboration among regulatory agencies, others

    To bridge the huge insurance gap in the country, there is need for collaboration between the National Insurance Commission (NAICOM) and other regulators both in Nigeria and other countries, Commissioner for Insurance, Mohammed Kari, has said.

    The Commissioner, who was represented by NAICOM Director for Inspectorate, Pius Agboola, spoke at the Risk Frontiers West Africa 2018 conference in Lagos.

    He said the collaboration between NAICOM and other foreign regulators is crucial for experience sharing.

    According to him, collaboration among insurance operators, other operators, NAICOM and other partners such as EFInA, GIZ (a German Corporation for international o-operation), A2II (Access to Insurance Initiative), MFW4A (making Finance work for Africa), among others, cannot be over-emphasised.

    He said insurance should be perceived not as a protection mechanism, but more importantly as a partnership that allows individuals and businesses to spread their wings and go to where otherwise they would not have dared to.

    He noted that one important observation to make is whether individuals and businesses have been able to spread their wings everywhere to enable them take un-imaginable risks and enjoy the associated rewards.

    The answer, he said, is the existence of insurance gap, which he described in his presentaion as the insurance protection gaps.

    Speaking on insurance protection gaps, he described uninsured losses as a proportion of total economy losses; uninsured people as a proportion of the total population; insurance actually purchased against economically beneficial coverage; actual insurance penetration against benchmark and financially excluded adults in insurance as a proportion of total adults of a country.

    He highlighted noticeable insurance gap areas for mature markets and economy as natural catastrophes, cybercrimes and risks; healthcare; pensions; and emerging risks.

    For frontier and emerging markets such as Nigeria, he said there are noticeable gaps in all areas.

    He, however, noted that insurance gaps in certain types of insurance may be more pronounced in one country than the other.

    He said NAICOM  has been trying to bridge the insurance gaps by working at root causes and providing remedies.

    He said: “To bridge insurance gaps in Nigeria, the Commission engaged in specific regulatory initiatives. They include improving insurance penetration and insurance literacy level; and Proposed Tier Based Solvency Minimum Capital (TBMSC).

    “The Commission improved insurance penetration by introducing stand-alone full license for Micro Insurance organisations while two Takaful Insurance licenses have been issued. Similarly, Bancassurance partnership with conventional banks has started while microfinance banks are in progress

    “Partnership with relevant agencies and state governments on compulsory insurances implementation is in progress while distribution channels are being expanded. Co-ordination with relevant government agencies for effective insurance of government assets is ongoing while we have partnership with relevant government agency like Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) on agriculture index insurance.”

    Speaking on how the Commission has been working to improve insurance literacy level, he said: “The Commission partnered the operators on awareness creation through the medium of Insurers’ Committee; partnered with foreign development agencies for sponsorship; reinforced our zonal and branch offices on insurance education at their domain

    “On the proposed TBMSC, we plan to encourage specialisation among insurers; strengthen insurer’s capacity; Improve insurance penetration; attract foreign investment; and Encourage healthy competition. However, the importance of collaboration towards reducing insurance gaps in developing nations cannot be over-emphasised.”

  • Report: industry now active in ESG development agenda

    Major participants in the reinsurance and insurance industry are becoming actively involved in shaping the Environmental, Social and Governance (ESG) agenda, a report by A.M. Best has shown.

    Director, Market Development and Communications, A.M. Best, Dr. Edem Kuenyehia, made the report made available to the press in Lagos.

    According to the report, the activity in the development of ESG agenda has been huge, giving operator’s unique role as risk managers, institutional investors, and risk carriers on behalf of a wide range of industries.

    The report read: “The industry also faces critical risks and opportunities associated with climate-change trends and challenges to close the protection gap.

    “Publicly listed multi-national insurance groups are well aware of shareholders’ expectations and try to align both their long-term investment and underwriting strategies accordingly. Increasing public awareness puts pressure on all types of financial institutions to consider ESG factors and their potential impact on reputational and operational risks.”

  • CIIN to hold Millennial Assembly

    Millennials within the age bracket of 21 and 30 in the insurance industry, will soon be lending their voices to the future of insurance business in the country, President, Chartered Insurance Institute of Nigeria (CIIN), Eddie Efekoha, has said.

    Efekoha who spoke at a media parley in Lagos, said the Institute is providing a platform called, Millennial Assembly for the young professionals to contribute to the development of the industry.

    He said the Institute is set to host the Millennials Assembly to equip  young professionals and enable them to chart new ways for the industry.

    He said the institute has written to insurance companies to send their staff within the age bracket to attend the event, noting that 31 companies had so far indicated interest to participate.

    He noted that the institute is mindful of the fact that the future of the industry rests on the shoulders of the youth, hence the institute has to prepare them for the jobs ahead.

    He further stated that his tenure will focus on his key mandate of advancing insurance education and professionalism to propel the insurance sector forward.

    He disclosed that the partnership programmes initiated with some tertiary institutions are already yielding results as the Senate of University of Lagos had last week approved the Memorandum of Understanding (MoU) signed by the parties.

    He said that the programme when operational, will pave way for Nigerians to run their masters in insurance in the country, instead of going to the United Kingdom.

  • NAICOM,operators should grow long-term fund

    Government intervention in the review and strengthening of extant legislations on insurance, and better implementation and enforcement of Insurance Act 2003 and the National Insurance Commission (NAICM) Act 1997 by the regulator, are possible actions to ensure optimal operation of the Insurance Industry, the Managing Director, Infrastructure Bank Plc, Adekunle Abdulrazaq Oyinloye, has said.

    Oyinloye, who spoke as a special guest at the 2018 Insurance Brokers Conference & Exhibitions on the theme: “Insurance Industry: Survive, Thrive,” held in Lagos, called on NAICOM to enforce compulsory insurances to boost the industry’s long term funds, saying the industry has made only a marginal investment in the infrastructure sector in recent years.

    He said there is enormous opportunity for the industry in infrastructure development and finance in Nigeria, pointing out that government has a role to play in ensuring that the industry plays its role in economic development by making relevant laws that will help make certain insurance policies compulsory and harsh sanctions for non-compliance of same.

    Citing Section 64 of the Insurance Act that makes compulsory insurance of building under construction which is more than two floors, he said the general implementation of the Insurance Act has left more to be desired.

    Oyinloye said with the long-term nature of life insurance, retirement savings and pension annuities, the Industry is well positioned to participate in infrastructure financing of Private-Public Partnership (PPP) projects, given the need to match long-term liabilities with long-term assets.

    He urged the National Insurance Commission (NAICOM) and operators to play their role in contributing private investment and sector expertise in long-term PPP infrastructure project, adding that there are unique opportunities for the industry to play a pivotal role in contributing private investment and sector expertise in long-term PPP infrastructure projects.

    He said: “In today’s low-yield environment, insurers are under increasing pressure to source additional investment return. Infrastructure investments may present an opportunity for insurers to achieve the required yields to cover future liabilities and provide competitively priced products.

    “Infrastructure investments are an interesting option for an insurer’s portfolio, as they provide potentially lucrative risk-adjusted return on equity; Long-term risk exposure, which may provide a good match for long-term liabilities; illiquidity and sector-diversity, which could increase portfolio diversification and an opportunity to lend money to sectors in need of funding, leading to social and potentially reputational benefits.

    Oyinloye said the Industry has made only a marginal investment in the infrastructure sector in recent years. However, there is increasing interest as insurers find that the benefits of infrastructure assets outweigh the apparent costs relative to the low yields available on more traditional investments. Therefore, insurers should understand the requirements of the infrastructure market to suitably influence the availability and attractiveness of investments.

    In this regard, the Development Finance Institution, like the Infrastructure Bank PLC is the Industry’s partner, as it sits on identified selection of deals and pipeline opportunities which may be well suited to an insurance investor. We explore the operational complexity of such an investment, and analyze the materiality of such risks, including the possible mitigation options available to insurers.

    He stressed that insurance sector as a component of an efficient financial ecosystem.

    Giving the foregoing, he posited that the situation presents a compelling need for designing and implementing bespoke financing instruments suited to the long-term financing needs of infrastructure projects.

    He said for such instruments to be bankable, insurers would be required to develop matching products that align with the tenor, as well as the risk and returns profile of infrastructure investments.

    “This reality is particularly crucial if the nation is to harness the capacity of private capital to bridge the existing funding gaps in the infrastructure sectors.

    Undeniably, the role of insurance sector in back-stopping, de-risking and underwriting infrastructure financing instruments can thus be described as a new frontier that would bridge the misalignment between typical corporate/individual lending facilities and infrastructure project financing facilities.

  • NAICOM stays action on recapitalisation, reclassification

    The National Insurance Commission (NAICOM), said it has shelved plans on its  implementation of the Tier-Based Minimum Solvency Capital (TBMSC).

    NAICOM in a circular, directed insurance companies to continue to operate on subsisting regulatory framework prior to the issuance of the circular on TBMSC.

    The circular is coming after weeks of confusion among insurance operators on the next line of action of the regulator on the policy.

    The Federal High Court had on September 13 granted an injunction sought by some shareholders under the umbrella of Independent Shareholders Association of Nigeria (ISAN) against the implementation of the policy pending the determination of the suit.

    NAICOM stated in the circular tagged, Update on the Implementation of the Tier-Based Minimum Solvency Capital Policy for insurance Companies in Nigeria, issued and signed by Director, Authorization and Policy, NAICOM, Leonard Akah that the companies should maintain status quo in line with the court order.

    The circular read: “In compliance with the extant rules and the injunction issued by the Federal High Court regarding the TBMSC framework which was to take effect from October 1, 2018, the Commission wishes to clarify that the status quo will be maintained and that insurers are to continue to operate on subsisting regulatory framework prior to the circular.

    “Appropriate regulatory directive would be advised upon conclusion of the suit” it stated.

    The TBMSC was meant to reclassify the existing 57 insurance companies based on their 2017 financial

  • Operators choose Tiers, seek capital

    Despite an order by the Lagos High Court restraining the implementation of Tier-Based Minimum Solvency Capital (TBMSC) policy by the National Insurance Commission (NAICOM), some insurance companies, Chief Executive Officers (CEOs) have indicated the Tier level they plan to operate out of the three available categories

    The CEOs, on the instruction of their boards and shareholders, are working with the regulator on the TBMSC policy plans.

    While some of the boards and shareholders have distanced themselves from the court order, they are on the other hand aggressively seeking additional capital in other to position properly to play well in either of the three Tiers categories.

    The TBMSC structure is a complementary measure to the ongoing implementation of the Risk-Based Supervision (RBS), programme. It is a three level model, which specifies capital requirement for each tier based on their respective risk classification.

    Tier-3 of the TBMSC stipulates that companies will operate on the existing minimum paid up capital of N2 billion for life, N3 billion for non-life and N5 billion for composite underwriters. Life companies will only be permitted to underwrite individual life policy, health insurance, and miscellaneous insurances.

    Non-life companies will only underwrite fire, motor, engineering (only classes covered by compulsory insurance), general accident, agriculture and miscellaneous insurances.

    To operate in tier-2 of the TBMSC, companies must have 50 per cent additional capital base. Life companies must have N3 billion capital base and will underwrite all tier-3 risks and group life assurance.

    Non-life companies must have N4.5 billion and will underwrite all tier-3 risks, as well as engineering (all inclusive), marine, bonds credit guarantee and suretyship insurances.

    For tier-1 players, companies must have 200 per cent additional  capital base. While life companies must have N6 billion capital base and will underwrite all tier-2 risks and annuity, non-life companies must have N9 billion capital base and will underwrite all tier-2 risks, as well as oil & gas, (oil related projects, exploration & production) and aviation insurances.

    In essence any composite company, that is life and non-life, that wants to be in tier-1 must have N15 billion, tier-2 must have N7.5 billion while tier-3 must have N5 billion.

    But some shareholders had on September 13, 2018 dragged the commission to court and secured a restraining order against on TBMSC structure implementation.

    Justice Hassan of the Federal High Court, sitting in Lagos, restrained the Commission from implementing the TBMSC structure until after the expiration of 30-day pre-action notice.

    The case was filed by Sir Nnamdi Nwosu and seven others  versus the NAICOM with suit number 1483 of 2018 FHC/L/CS/ 1483/18. Counsel to the plaintiffs are B. C. Igwilo, SAN and Chuks Nwachuku.

    A CEO, who spoke under the condition of anonymity, said as operators, they cannot work against their regulator.

    He said while they pray for a postponement of the implementation of the policy, it is in their best interest to continue with the processes of the policy.

     

  • Oluyanwo becomes PILA President

    The Professional Insurance Ladies’ Association (PILA) will continue to sustain ethical standard and promote the welfare of women in the insurance industry, its new President, Mrs. Ose Oluyanwo, has said.

    She made this known in her acceptance speech at her investiture in Lagos.

    The association, however, launched a 194-page seminal book tiitled: “The Pillar: Evolution, Trends and Development of Professional Insurance Ladies Association”.

    The publication, according to Mrs Oluyanwo, will serve as an unassailable historical reference as it highlights PILA‘s pathway from infancy till date.

    She said her  thrust will be the sustenance of the legacies and programmes of her predecessors.

    According to her, members must come to terms with the fact that governance or administration of a corporate institution like PILA should be a continuum.

    She said: “I believe that each regime must continually build conscientiously on the moulding blocks laid by previous administrations, of which, most times, they are part of. Suffice it to note that PILA already has in place solid programmes such as mentoring programmes for the younger professionals and new entrants; career talk across educational institutions, and most importantly, the completion of our ultra-modern secretariat complex to give the association a more formidable image.

    “Similarly, we will vigorously pursue effective data collection for the association and its membership and the sustenance of ethical standards, without forgetting the association’s international responsibilities under the nascent PILA Africa, which would be a light to other sister African countries.

    “We will continue to re-orientate members to shun divisive tendencies peculiar to the womenfolk and which often keep us disunited.”

     

  • AIICO launches Agric Insurance

    In response to the need for adequate insurance to protect investments in agricultural sector, AIICO Insurance Plc has launched its Agriculture Insurance policy.

    To achieve optimal result, the underwriting firm has partnered Nigeria Incentive Risk Sharing System for Agricultural Lending (NIRSAL).

    Its Managing Director, Edwin Igbiti, who spoke during the official launch  in Lagos said the firm was taking strategic position to be a major player in offering Agriculture Insurance in order to deliver the much needed protection to the various players in the agricultural value chain.

    According to him, insurance coverage in the country is still extremely low when compared to small holders farmers, adding that it is obvious that active participation of insurance companies is required to deliver much needed protection to farmers and other stakeholders in Agricultural sector in terms of risk exposure.

    AIICO, he said, has decided to come in as an insurance leader in the industry in taking this strategic position to be a major player in offering agriculture insurance in order to deliver the much needed protection in different players in agricultural value.

    “Having recently obtained approval of our regulator, NAICOM, as an agricultural insurance underwriter,” he said, “the company is uniquely positioned to offer both indemnity and index based agricultural products to all farmers at all level.”

    He added: “As investors, we are looking to tap the good potential of the sector through its value based insurance proposition. It is our fine believe that our boldness in introducing full array of agricultural insurance product offerings to the market will go a long way to support the initiative and intervention of government and job governmental organisations towards the development of the agricultural sector.

    “With an average contribution of 24 per cent, agriculture has remained a significant contributor to Nigeria’s GDP. Being the provider of employment for over 60 per cent of the population, agriculture is pivotal to economic development, and more of the efforts to revive the economy, and reduce significantly the level of poverty, should be devoted to energising the agricultural sector. The agricultural sector is exposed to extremely high degree of risk arising from natural factors like weather conditions, pests and diseases and other environmental forces.”

    NIRSAL’s Executive Director, Mr. Babajide Arowosafe, on his part, said agriculture is permeating every sector, especially the financial sector of the economy

    He lauded AIICO for taking the giant stride to provide insurance cover for farmers and partnering NIRSAL.

    He explained that NIRSAL is one of the institutions established by the Central Bank of Nigeria (CBN) to permeate the agricultural sector.