The Nation Newspaper

Tag: micro-insurance

  • Committees on corporate governance, micro-insurance to boost industry guidelines

    The Joint technical, legal and micro insurance committees set up by the Nigerian Council of Registered Insurance Brokers (NCRIB) have met to fine-tune new regulations on Corporate Governance and Guidelines on Micro Insurance proposed by the National Insurance Commission (NAICOM) for the Council’s input.

    NCRIB President, Shola Tinubu, who made this known during the quarterly press briefing of the Council in Lagos, said the meetings are in line with the Council’s proactive response on industry’s regulatory guidelines.

    He pointed out the tempo of proactive response to laws and regulatory prescriptions by NCRIB have been sustained, adding that the Council hopes that the far-reaching suggestions by the Council would serve as good inputs into the guidelines.

    One of the cardinal focus of his administration, he said, is self-regulation, adding that this is the reason why they coined the “Self-Regulation for Self-Respect” slogan, which will continue to be their guide.

    “In our bid to give necessary impetus,” he said, “the Council has published nuggets on compliance issues for members.”

    He noted that the publication would be sustained to add value to members and simplify their operations, streesing that his administration started on a positive note in its quest for a better relationship with NAICOM through visitation to the Commission.

    “In the last three months, we have visited the Commission twice. We used the opportunity to raise crucial matters bordering on contemporary issues on regulation of Brokers, fines and penalties etcetera. The Commission expressed support and showed positive inclination to cooperate with the regime for the benefit of Brokers.

    “The promise of the Commission has started manifesting in its subsequent dealings with the Council as the Commissioner and a team of top management of NAICOM have found time to attend some of our events to shed light on torchy regulatory issues to the delight of members,”he said.

    On issues of compliance with the Federal Government Voluntary Assets and Income Declaration Scheme (VAIDS), he said: “We are all aware that there is no nation that could attain economic buoyancy without exploring taxation as a key revenue option of government. Most modern economies are buoyed on effective taxation and ours cannot be an exception.

    “However, it would be apposite to stress that it behooves on government to live more to its fiscal responsibility when adequate compliance is received from the people and institutions.  When the confidence level is enhanced, payment of taxes would no longer be seen as a burden, but a cardinal responsibility to be discharged by the citizenry.”

     

  • Nigeria, seven others mull special policies for micro-insurance

    Nigeria and seven other countries are considering some special policies for micro-insurance to speed up its development, an insurance expert, Prof Festus Moboluwaji Epetimehin, has said.

    He spoke at the 6th Inuagural Lecture of the Joseph Ayo Babalola University, Ikeji-Arakeji in Osun State.

    The other countries, according to him, are Ethiopia, Egypt, Ghana, Kenya, Uganda, South Africa and Zambia.

    He said some African countries were making efforts to reel out measures and policies that would speed up the acceptance of micro-insurance.

    Epetimehin, whose lecture was anchored on “Small but Big: Micro-insurance and the reduction of social risk of poverty”  said: “Currently, some African nations, such as Nigeria, Ethiopia, Egypt, Ghana, Kenya, Uganda, South Africa and Zambia, are in the process of considering special policies and regulatory frameworks to spur micro-insurance market development.”

    Epetimehin tasked African governments to learn from policy approaches at the global level.

    He said: “Across the globe, many governments particularly finance ministries, financial sector regulators and insurance supervisors have recognised that expanding the insurance sector to include broader population segments can spur economic development and welfare.

    “The creation of a financial sector characterised by competition, market efficiency and outreach is on the development agenda of numerous governments in Africa.”

    Enabling policies and regulations, along with effective supervision, facilitate the growth of private-sector involvement and enhance the distribution and quality of micro-insurance.

     

  • Epetimehin to deliver lecture on micro-insurance

    Chairman Mofes Insurance Brokers Limited Prof Festus Mobolaji Epetimehin will deliver an inaugural lecture on mircro-insurance to hundreds of scholars and residents in Osun State.

    Epetimehin, a Professor of Insurance and Risk Management, will deliver lecture on “Small but big: Micro-insurance and the reduction of social risk of poverty”, at Joseph Ayo Babalola University (JABU) in Ikeji, Osun State next month.

    According to him, micro-insurance was considered as one of the most effective means of reducing the vulnerability of the poor from the impacts of disease, theft, violence, disability, fire and other hazards.

    He said insurance protects against unexpected losses by pooling the resources of many to compensate for the losses of the few, the more uncertain the event, the more insurance becomes the most economical form of protection.

    He noted that there was an unjust paradox that the poor are the most vulnerable to hazard, but have little or no access to efficient risk management strategies.

    Epetimehin said: “The reality is that the risk management process of the poor has to be transformed or completed by giving access to new opportunities. In this way, the poor becomes more empowered through the possibility to make choices. Micro-insurance could be such a new opportunity. It is a system that protects poor people against specific shocks, using risk pooling, in return for regular affordable premium payments proportionate to the likelihood and cost of the risk involved.”

    Micro-insurance does alleviate poverty by reducing the impact of hazard in rural areas, but protects clients from risk, reduces micro-finance institution (MFI) loan default, earns additional income for the MFIs, and enhancing outreach and scalability. It is thus a useful complement to, rather than a substitute for, savings and credit in protecting the poor against risk and allows them to retain and develop financial, social and human capital in the long term,” he added.

  • NIA to sustain stability, growth through micro insurance

    The Nigeria Insurers Association (NIA) has embarked on closer interaction with the  informal sector to ensure stability and growth for businesses, its Director-General, Sunday Thomas, has said.

    He made this known while speaking at the conference/fair in Lagos. The event had market women, traders, artisans and non-governmental organisations (NGO) in attendance.

    He said that insurance is a viable tool for mitigating losses among the less privileged.

    He noted that the conference/fair is their first ever on Micro Insurance subsector and also their first deliberate effort to reach out to the informal sector of our economy.

    He stressed that the insurance industry regulator, the National Insurance Commission (NAICOM) has sets out the framework, road map, market and regulatory strategic directions for the operation of micro insurance in Nigeria.

    He said: “This conference is put together by the Micro Insurance committee of the Nigeria’s Insurers Association. Our aim is to bring together all stakeholders concerned with micro insurance in Nigeria with the overall objective of ensuring that both the demand side and the supply side of micro insurance are in sync together.

    “It is also meant to create awareness for our member’s micro insurance products for informal sector of the economy. It is common knowledge that insurance culture is very low among the informal sector and it would take deliberate effort like this to win the confidence of this sector.

    “The country diagnostic study says less than 1 per cent of the adult population in Nigeria have access to a voluntary insurance policy.  Nigeria is among the least countries in terms of insurance contribution to GDP which is around 0.72 per cent.”

    He said the sector is regarded as “a grossly untapped opportunity” because we have not yet appealed to the informal sector which constitute over 80 per cent of the Nigerian population.

    “For the NIA, the obvious way forward is to through closer interaction with this sector, intensive capacity building and greater expertise in micro insurance, providing unique micro insurance services, development of people friendly products, and improved innovative distributive system.”

    “Micro insurance is targeted at the informal sector and the low income masses. It is the most veritable too for mitigating losses from unexpected accidents and disasters.  Low income groups are invariably exposed to innumerable risks. Micro insurance works on the phenomenon of risk transfer mechanism characterized by low premiums and low coverage limits.

    “As an industry we will continually seek for opportunities to court the friendship of this sector. For us the future of our industry most probably lies in what we do with this sector and how they the sector accepts our products and services. We are optimistic that the relationship we are starting today will continue to blossom and get stronger”, he noted.

  • NIA holds micro insurance fair

    The micro insurance committee of the Nigeria Insurers Association (NIA), will on Wednesday hold a micro insurance fair in Lagos.

    NIA Director-General, Sunday Thomas who made this known at a press briefing at the weekend, said the fair will hold at the LTV premises.

    According to him, the main objective of the fair is to sensitise stakeholders both on the supply side which includes the underwriters and brokers and the demand side which includes the insuring public and the general public at large.

    He said the group is expecting the Iyaloja of Lagos, market women, artisans, small and medium enterprises (SMEs,  among others at the fair while the Commissioner for Insurance, the National Insurance Commission, Mohammed Kari, will deliver the keynote address.

    He noted that the group consider the fair important because it knows that majority of Nigerians are in the low income group.

    He said with micro insurance, member companies will be able to develop products that will meet their demand.

    He said the group also wants to leverage on the current structure with over 150 million population to deepen insurance penetration. “Majority of Nigerians are in the low income group, therefore, we want to develop products that will meet their demand. ‘’The fair will bring together all stakeholders. We are also expecting  about two information communication partners because it has proved to be very good means of selling micro insurance products,’’ he added.

     

  • NCRIB takes micro insurance campaign to market women

    THE Nigerian Council of Registered Insurance Brokers (NCRIB) has taken the campaign for micro insurance awareness to market women.

    Its President, Mr Ayodapo Shoderu, who led the crusade during a visit to the Iyaloja -General of Nigeria, Mrs Folashade Tinubu-Ojo in Lagos , said market women and traders constituted a significant segment that must be mobilised for the growth of insurance growth in Nigeria.

    Shoderu said the Market Development Restructuring Initiatives (MDRI) has brought more attention to micro insurance to further create wealth for Nigerians, especially the budding entrepreneurs and small scale business promoters at the grassroots.

    He said: “Suffice it to say that market women and men are prone to diverse risks that daily threaten their existence. The most significant of which is theft and fire outbreaks and these risks could be borne on their behalf by the insurance industry.”

    The NCRIB chief, who listed instances of devastating market fire disasters in Nigeria, noted that such perils had left tales of woes for their victims and increased poverty levels in the country.

    “Accepted that governments and concerned individuals give some forms of succour to victims after such incidents,”Shoderu said, adding that such assistance is monetary and could have been more long-lasting through insurance.

    He said brokers were in better position to assist the market women in view of their numerical spread across the nook and cranny of Nigeria and their knowledge, which they could deploy in assisting clients in profitable insurance placement and claims payment when loss occurs.

    Shoderu seized the opportunity to applaud governments who spend monumental sums of money to erect ultra-modern markets, advising that adequate building insurance covers must be put in place for such projects to safeguard against unfolding risks in line with the laws on compulsory insurances.

    The Iyaloja-General commended the initiatives of the NCRIB for the visit.

    She assured that the campaign would be taken to market women and men for their business growth.

  • NAICOM inaugurates steering committee on micro-insurance

    NAICOM inaugurates steering committee on micro-insurance

    The National Insurance Commission (NAICOM) has inaugurated a 14-man steering committee made up of representatives of stakeholders across the financial services market to assist in making the micro-insurance initiative successful.

    NAICOM has also said the guidelines on micro-insurance will take effect from January 1, 2014 with the objective of providing minimum standards for the conduct of micro-insurance in the country.

    The committee, which is headed by the director-general of the Nigeria Insurers Association (NIA) has representatives of NAICOM, Central Bank of Nigeria, FSS2020, NIA, German Cooperation (Giz), National Health Insurance Scheme (NHIS).

    Others are Small and Medium Enterprise Development Agency of Nigeria (SMEDAN), LeapAfrica, National Association of Micro Finance Banks, the Nigerian Council of Registered Insurance Brokers (NCRIB), Industrial and General Insurance Plc, Association of Registered Insurance Agents (ARIAN), Institute of Loss Adjusters of Nigeria (ILAN) and others.

    The terms of reference for the committee include; developing the action plan for micro-insurance implementation in Nigeria,  identifying and making recommendations to NAICOM on issues that affect micro-insurance implementation in Nigeria; make recommendation on possible improvement that can be made on regulatory and operational framework; and any other assignment as may be directed by the regulator.

    Commissioner for Insurance represented by Deputy Commissioner, Finance and Admin, Mr. George Onekhena who inaugurated the committee at the NAICOM Office in Lagos tasked them to start working on the terms of reference earlier announced during the launching of the guideline.

    He said the introduction of micro-insurance would help reposition insurance practice in the country, adding that it would help deepen penetration and reach to the public at the grassroots.

    He called on would-be-operators to leverage the opportunities provided by technology and initiatives in the banking sector to reach out to the public, stressing that without technology, it would be difficult for the operators to operate successfully.

    He also urged the committee to explore the successes recorded in other nations where the practice has been entrenched and workout measures that would make the practice successful in the country.

    He said the objectives of the guidelines it is to ensure consumer protection, establish general features of micro-insurance, establish duties and responsibilities of micro-insurance operators and service providers, establish conditions for entry and exit from the micro-insurance market.

    According to him, the concept of micro-insurance products is insurance products that are designed to be appropriate for the low income market in relation to cost, terms, coverage and delivery mechanism.

    Chairman of the committee, promised to leave up to the confidence reposed on them, adding that the job assigned them is significant and that they would give it the seriousness required.

    He said the committee would engage in studies, consultations and examine how nations that are making progress got to where they are.

  • MfBs, insurers to explore N60b micro-insurance potential

    Ahead of the release of guidelines for micro-insurance operation, micro-finance banks (MfBs) and insurance companies are contemplating how to explore the potential of the subsector said to be worth N60 billion.

    The National Insurance Commission (NAICOM) is expected to release the frameworks for the implementation of micro insurance operation in a few weeks.

    Through micro insurance, MfBs would be able to sell insurance products to those at the bottom of the pyramid. The initiative is expected to bring in more revenue and expand the markets of the insurance firms and the banks for growth.

    Insurance Commissioner, Mr Fola Daniel, said plans were underway to release the micro insurance guidelines before the end of next month to enable operators benefit from scheme.

    He said the guidelines would enable insurance operators take micro insurance policy to the grassroots where microfinance banks are major players.

    He said when the micro insurance guidelines are out soon, poor Nigerians can buy insurance at a cheaper rate. He added that the idea would ensure insurance penetration, especially in the rural areas where underwriting firms have done little to capture.

    Chairman, National Association of Microfinance Banks (NAMBs), Southwest region, Mr Olufemi Babajide, said the association is waiting for the guidelines to enable its members key into the scheme.

    Babajide said when the guidelines are out, the banks would be able to help in selling insurance products to its customers.

    He said the banks were not new to insurance, adding that they have been rendering insurance advisory services to people. He advised MfBs to tap into the opportunities offered by the micro insurance scheme.

    Babajide urged insurance companies to come up with simplified products and services that will be affordable to microfinance clients, taken into consideration the nature of the market they want to play. He said when the guidelines are able to solve technical issues relating to micro insurance products, there would not be problems in selling them.

    He said: “The issue of micro insurance is a good one. It is a positive development, and no doubt, we will embrace it with our two hands. The idea of micro insurance will help in safeguarding the investments in microfinance banks, especially in lending. For instance, we always give loans to poor people, and if their businesses suffer mishap, it will affect their repayment flow, hence making low recovery difficult. But with micro insurance, we are rest assured that our money is safe because if our customers suffer fire outbreak, theft among other risks, the underwriting firm is there to compensate them, and as a result they can repay their loans.”

    Managing Director, LAPO Microfinance Bank, Mr Godwin Ehigiamusoe, said the poor were more vulnerable to risks, adding that the impacts on them are always severe. This, he said, means that they need insurance more than the wealthy people.

    “The poor needs insurance services than even the rich people. While a financially comfortable person can access medical care, the poor cannot and in the long run, may die from preventable diseases. Based on this, the micro insurance is needed for the poor, which form the basis of micro banking activities,” he added.