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Tag: NAICOM

  • NAICOM targets MfBs for micro insurance market

    NAICOM targets MfBs for micro insurance market

    Plans are afoot to use microfinance banks(MfBs) as channels of developing micro insurance market and further generate more deals for the industry, it was learnt.

    The National Insurance Commission (NAICOM) is discussing with the management of microfinance banks to achieve this goal.

    The insurance regulatory body is leveraging on the 20million potential customers of microfinance banks to sell insurance products and further rake in billions of naira in premiums.

    NAICOM’s Director-General, Mr Fola Daniel, said efforts were being made to promote micro insurance to a level that would raise the earnings of operators.

    He said aside cooperative societies, microfinance banks are among the channels the corporation intends to use in selling micro insurance because they are closer to the grassroots. He said micro insurance clients would be reached through microfinance banks.

    Daniel stressed that with the micro insurance guidelines, poor Nigerians could buy insurance at a cheaper rate.

    The Chairman, National Association of Microfinance Banks (NAMBs), Southwest Region, Mr Olufemi Babajide said the decision of NAICOM to use microfinance banks to sell insurance policies to small savers is a good development to the industry. He said this would provide mutual benefits to the parties involved in the partnership.

    He said banks have a bigger market, strength, among other things,to make the idea of selling micro insurance policy a reality.

    He said: “We have our population, and that is a credit to the banks, especially in pushing such products in the market.”

    He said insuring the credits of the banks, is pertinent to the success of the banking sub-sector.

    According to him, NAICOM should be able to ensure that the banks’ credit risks, such as savings and loans, are insured for growth.

    Babajide said the major problem facing the banks is credit risk, adding that the banks would minimise its risks as much as possible if their credits are insured by the insurance companies.

    “What we are saying is that the issue of insuring our credits is important to us as well. NAICOM, though its operators, need not run away from risks to make the arrangements workable. The essence of insurance is risk,” he added.

  • Defaulters’ll be punished, says NAICOM

    The National Insurance Commission (NAICOM) would continue to expose and sanction erring operators to serve as deterrent to others, the Commissioner for Insurance Fola Daniel, has said.

    He told The Nation that the commission would never sweep cases of errant operators under the carpet or shield them from sanctions, adding that punishment meted out on such operators are to ensure safety of policy holders and shareholders.

    Daniel said NAICOM,in imposing sanctions, gives priority to the protection of the industry, adding that it would not be disturbed by the outcry of highhandedness by some operators.

    He said: “I believe the public would want NAICOM to be like the Central Bank of Nigeria (CBN) as regards sanctions. The method of Central Bank is not a cap that fits all. It is not a medication that cures all ailments. The approach of Central Bank has its own merits, which is do it publicly let Nigerians be aware of what is happening. Of cause, the Central Bank was confronted with a different scenario that needed the remedy they applied.

    “The problem of the insurance industry is not exactly the same. So, we may not be able to borrow that medication to cure a different ailment. When you have diarrhea, you have to take drastic medica-tion to stop it, because it could embarrass you. Whereas, somebody who has headache would take panadol; two of them are medications, but are intended for different purposes. And the effects look different. So, we salute the Central Bank for what they are doing, but I want to confirm to you that from time to time, we sanction insurance operators and if it is important for the public to know, we let them know.

    “Our sanctions are largely remedial. What is upper most in sanctioning a company is the protection of policy holders. If I sanction an insurance company and put it on the pages of newspaperS, without obtaining a remedy, how does that help the policy holder? But if I can effectively sanction an operator and the interest of policy holder is fully served, that means we are doing the right thing. Let the Central Bank continue to do what it is doing; we have a different problems and different approaches in resolving the problems.

    “I assure you that we are not sweeping anything under the carpet or shielding any operator. As a matter of fact, for some months, I think there have been shouts and cries from the industry about the sanctions we have given to errant operators. We are acting as it becomes 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.”

    It would be recalled that the commission, early in the year dropped its hammer on some 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 loose of its hook.

  • ‘NAICOM to maximise opportunities in sector’

    ‘NAICOM to maximise opportunities in sector’

    The National Insurance Commission has promised to ensure the maximal use of opportunities in the sector.

    Commissioner of Insurance Mr Fola Daniel made this known at the inauguration of the Nigerian Council of Registered Insurance Brokers (NCRIB) secretariat and a book launch in Lagos.

    He urged insurance practitioners to be united, adding that an achievement by an arm of the industry is a success for other operators.

    Daniel said brokers have made the industry proud by constructing a befitting office. He urged them to sustain the development entrenched by their founding fathers.

    He said brokers, who are over 600, should set the pace as they constitute the largest group in Africa.He lauded the contributions of past and present leaders of the NCRIB, which he said have helped to position the council for improved performance.

    Daniel also commended brokers for writing a book on insurance broking in Nigeria. He urged insurance practitioners to buy the book to update their knowledge, adding that it would help improve their performance.

    President, NCRIB, Mrs Laide Osijo, who was excited over the completion and opening of the office, said the council conceived the idea of having a befitting secretariat over two decades ago.

    She noted that its completion was a fulfilment of purpose, vision, and commitment of the founding fathers of the profession to bequeathe an edifice to the Council.

    She lauded the stride made by Daniel in creating a conducive environment, which encouraged brokers to uphold their financial commitment to the council. She also commended the efforts of the founding fathers and her predecessors in taking the profession to a lofty height.

    Laide said: “The erection of the NCRIB secretariat, has among other things, propelled our profession into a position of respect in the comity of other progressive professional bodies in Nigeria. Let me note, however, that there are still rooms for members to be a part of the success story of this building and etch their names on gold.

    “Historically, the idea of having a befitting secretariat worthy of the rising profile of NCRIB, which is unarguably one of the oldest professional bodies in Nigeria, was conceived more that two decades ago. It is, however, providential that the building is being completed and inaugurated during my tenure as the first female president of our great council.”

    Managing Director, Lasaco Assurance Plc, Olusola Ladipo-Ajayi, commended the leadership of NCRIB for making the industry proud through the completion of the office, adding that underwriters and brokers in recent time have been working together to reposition the industry.

    The President Chartered Insurance Institute of Nigeria (CIIN), Dr Wole Adetimehin, said the rift among insurance operators is inimical to the industry’s growth.

    He said the operators are loyal to the industry they belong to instead of working as professionals with a common stake.

    He called on the practitioners to have a change of attitude, adding that the industry could only grow when stakeholders show commitment to their profession.

    “We must shed this coat and put up a united front as one profession,” he said.

    He noted that the need for change of attitude and total commitment to the profession could not be over emphasised.

  • Agents bicker over commissions, fees

    Agents bicker over commissions, fees

    A CRISIS is brewing between underwriters and insurance intermediaries over commissions and fees.

    The Nation gathered that they are quarelling over what should be their ‘’appropriate” commissions and fees.

    Investigation revealed that the intermediaries – brokers, loss adjusters, agents and risk surveyors – are not happy with their remuneration. It was also gathered that most of the intermediaries’ entitlements are not paid by underwriters.

    It was learnt that the brokers early this year took their complaints on group life commissions to the National Insurance Commission (NAICOM), demanding an increase.

    NAICOM asked them to agree on a fixed rate and get back to it.

    The Nigerian Insurers Association (NIA) and Nigerian Council of Registered Insurance Brokers (NCRIB) were mandated to use a single letter-head to inform NAICOM on the agreed rate.

    It was learnt that the parties’ efforts were unproductive as NIA shunned the meetings. The development compelled NAICOM to peg the commission at eight per cent and mandated the operators to comply.But this is not go down well with brokers.

    President, Risk Surveyors Association of Nigeria (RISAN), Jacob Adeosun, called for a resolution, adding that the inappropriate remuneration of surveyors would lead to exit of experienced practitioners from the industry.

    He noted that survey fees are not paid promptly by underwriters, stressing that the arrears of unpaid fees was capable of affecting the efficiency of surveyors’ service delivery.

    Chairman,Technical Committee of the NCRIB on Market Development and Restructuring Initiatives (MDRI), Siyan Oyebadejo, said poor remuneration of agents by underwriters is threatening the MDRI, a project which is meant to drive insurance penetration.

    He noted that unless something drastic was done, the initiative would fail to meet the industry’s expectations, adding that the committee had recommended to NAICOM, the need to increase the remuneration paid to agents who are the drivers of the initiative.

    He said it was worrisome that graduates engaged as agents were paid pittance, an amount, which could not move them around the market and win businesses, noting that the initiative would only succeed if the agents were well motivated.

  • NAICOM takes over ailing firms

    NAICOM takes over ailing firms

    • Shareholders hail action

    Shareholders have praised the National Insurance Commission (NAICOM), for taking over some ailing firms.

    So far, the commission has taken over Goldlink Insurance Plc and Alliance and General Insurance.

    The President, Nigerian Shareholders’ Renaissance Association (NSRA), Olufemi Timothy, said with this step, underwriters would now sit up.

    He said: “With the measure taken by NAICOM, underwriters would see the Commission as a dog that can bark and bite. It is a good development that some people are made scapegoats. We have been complaining of uncomplimentary things going on among the underwriters.

    “Now that NAICOM has risen to punish them, they would realise that most of the things they have been doing that they cannot escape with them.

    “The step taken by NAICOM is a good development and it portends a good future for the industry”.

    On why shareholders have been silent over the rot that is being uncovered by NAICOM, he said: “When you talk of shareholders in the insurance industry, you are likely to have 200,000 of us. Where you have 200,000 shareholders, opinions would vary. Some of us who are active have been talking of the misdeeds in these companies, but nobody listened to us. We had been calling on the regulators to look into the accounts of these firms, but nobody cared to listen, but now that we have got somebody who was ready to listen and take action, we are happy that our voices would be adhered to and our complains would be acted upon,” he said

    Secretary, Nigerian Shareholders Solidarity Association (NSSA), Gbadebo Olatokunbo, said the taking over of the companies was good, adding that it would raise the confidence of stakeholders.

    He noted the measure would deter other operators who are carefree in carrying out their responsibilities.

    NAICOM, in a statement, said it has constituted a seven-man interim board of directors to oversee the affairs of Goldlink with effect from November 1.

    It noted that the constitution of the interim board is sequel to the resignation of members of the board of directors of the company following anomalies discovered in the audited financial statements of the company for the year ended December 31, 2011.

    The board is, among other things, charged with investigating the financial reports and corporate governance failures observed in the company’s financial statement for the year ending December 31, 2011.

    The board, which has a six-month tenure, has Mr James O. Ayo, as Chairman; Gbolahan Olutayo, as Managing Director and Mr Adeyinka Olutungase, as Chief Finance Officer.

    Other directors are Ambassador Umar Damagun, Alhaji Sashe Dabana, Prof. Chioma Kanu Agomo and Mallam Abubakar Sadiq Mijinyawa.

    The statement said the development would not affect the firm’s service delivery.

  • NAICOM to check false declaration of accounts

    NAICOM to check false declaration of accounts

    The National Insurance Commission (NAICOM) is to start the validation of debts often believed to be overstated in the accounts of insurance firms to ascertain their authenticity, a source has said.

    NAICOM’s Deputy Commissioner Finance and Administration George Onekhena, who confirmed this, said the commission was poised to remove fictitious items from insurers’ books.

    He noted that the commission has received reports from the Nigerian Council of Registered Insurance Brokers (NCRIB) indicating that some debts in the books of underwriters are cooked.

    On steps to be taken by NAICOM, Onekhena said the commission has come up with some strategies one of which is the “No Premium No Cover” policy. This, he said, will stem the claims of withholding or unpaid premium often reported by underwriters.

    He said: “NAICOM would soon commence the validation of debts in the books of companies to ascertain the true position of the debts. “2012 is a year of reality; we are going to remove everything that is fictitious in companies’ books,” he said.

    Though some people believe that the “No premium No Cover policy” would not work, he said the commission would work and that they were going to adhere to the policy to wipe debts off the books of underwriters.

    He noted that the commission would continue to engage underwriters to ensure that they nip in the bud the challenges that they are having on the cleaning of their books for effective transition to International Financial Reporting Standard.

    He said many firms have been sanctioned for infraction, adding that while the commission disciplines firms, it would also ensure that the industry is protected.

    Meanwhile, as part of measures aimed at sanitising the accounting systems of insurance firms, the National Insurance Commission (NAICOM) has warned auditors of underwriting and broking firms, that henceforth they would be liable for approving falsified financial accounts.

    Onekhena, who disclosed this during a seminar organised by the Commission for external auditors to insurance and broking firms in Lagos, said auditors would be held liable for their opinion in the financial books of insurance operators in this International Financial Reporting Standard (IFRS) dispensation, adding that any auditor that approved a falsified account would be reported to the Financial Reporting Council (FRC).

    He urged auditors to clear grey areas with their clients before approving their accounts. He told the auditors to esteem integrity, noting that it is better not to have a job, than having one that would tarnish their image.

    He urged the auditors to report to NAICOM any challenge they observed in executing their responsibility.

    He said: “We are going to hold auditors responsible for their opinion in the financial accounts of companies. We would profile auditors with issues on their practice and report them to the Financial Reporting Council (FRC). Auditors should note that their responsibilities have increased in the current dispensation.

    “We do not want to make a mess of the International Financial Reporting Standard (IFRS) by next year; that is why we are investing in training and capacity building of operators and auditors.”

  • RISAN holds conference on disaster management

    Risk Surveyors Association of Nigeria (RISAN) will hold its national conference next month, in Lagos.

    Entitled: Human element in disaster management and loss prevention, the conference, the President of the association, Jacob Adeosun, said in a statement, will address the challenges of disaster management and proffer solutions to mitigate the occurrence of losses on roads as well as in commerce and industry resulting from industrial fires and allied perils.

    Adeosun said the conference will focus on the impact of human element in disaster management at this year’s parley given the central position which human beings play in managing the challenges of risks.

    Expected at the event are Mr Fola Daniel, Commissioner for Insurance (NAICOM); Dr Remi Olowude, Chairman, Nigeria Insurers Association (NIA), Dr Wole Adetimehin, President, Chatered Insurance Institute of Nigeria (CIIN) and Mrs Laide Osijo, President, Nigerian Corporation of Registered Insurance Brokers (NCRIB), among others.

    The conference will climax with the investiture of Adeosun as the President of the association.

  • NCRIB to partner NAICOM on debt validation

    The Nigerian Council of Registered Insurance Brokers (NCRIB) will partner with the National Insurance Commission (NAICOM) on its planned validation of debts allegedly owed by brokers, NCRIB Prresident Mrs laide Osijo has said.

    Mrs Osijo told The Nation that the council suggested the idea to validate the debts to NAICOM, adding that brokers are striving to be ethical and professional and would never engage in anything that would attract sanction.

    She said: “We suggested the idea to validate acclaimed debts to NAICOM. The underwriters have been accusing brokers of with-holding premium which is not true. The underwriter often claim that the premiums has been paid and that brokers are with-holding them. But the truth is that most of the premiums are receivables that are not yet collected, especially government accounts, adding that because the debit notes are written by brokers, it is assumed that the money is with brokers.

    “The allegation is unfounded. We have asked underwriters that have documentary evidence to bring them out, so that we can do reconciliation. That was the advice we also gave NAICOM.The commission wrote us and we replied by telling them to ask underwriters to show evidences of premiums with-held by brokers. I would not say that brokers do not err, but brokers in the past are different from those practising now. ‘’

    She further stated that brokers of these days are afraid of being sanctioned, hence, they abide by rules. ‘’So we are trying to practice professionally and ethically these days, and I can boldly boast of that. Why would anybody accuse somebody for no just cause? It is unfair. If it is possible underwriters can go to the insured to confirm if the premiums have been paid, instead of accusing brokers unjustly. But that may be going to the extreme for there is no contract between the insured and the underwriter. Since we bring the business, we should be allowed the freedom of contract,” she said.

    She said NCRIB would collaborate with NAICOM to validate the claims of underwriters to stem the allegation that brokers hold back underwriters’ premiums, stressing that there should be proper documentation before laying accusation on the brokers.

  • NAICOM pegs group life commission at 8%

    NAICOM pegs group life commission at 8%

    The National Insurance Commission (NAICOM) has pegged group life insurance commission at eight per cent, The Nation has learnt.

    A source said the commission had written underwriters and brokers, ordering them not to charge more than eight per cent commission on group life insurance. Violators, he said, would be sanctioned.

    “NAICOM made it clear to the operators that group life commission is not nine per cent as being canvassed by some practitioners, the source said.

    It was gathered that underwriters and brokers have been on a running battle over what should be charged as commission.

    Investigation revealed that both parties early in the year agreed to raise the commission to nine per cent, but the underwriters later reneged on the agreement, as it was considered inimical to their operation.

    The circular by NAICOM, it was gathered was issued to halt the running battle between brokers and underwriters.

    From a reliable source, it was learnt that NAICOM made several attempts to settle the rift between the parties, but failed because the underwriters were not ready to keep to the agreement reached with the brokers early in the year.

    Though brokers were uncomfortable with the new policy issued by NAICOM, they agreed to abide by it to avoid being sanctioned.

    The commission would be applied on this year’s Federal Government group life insurance, which premium is valued at about N7 billion and over 300 brokers appointed by the Federal Head of Service.

  • NAICOM resolves N1.22b claims disputes

    NAICOM resolves N1.22b claims disputes

    The National Insurance Commission (NAICOM), through its Complaints Bureau, has facilitated the settlement of N1.220billion claims which were in dispute in the first half of this year.

    A statement by the Assistant Director, Corporate Affairs, NAICOM, Lucky Fiakpa, said the Bureau resolved 52 cases within the period.

    He said the Bureau dealt with a total of 349 cases and held four adjudication meetings, adding that out of this figure, 86 were fresh complaints, while the remaining 263 are existing/on-going cases.

    Fiakpa, said the outstanding claims are currently receiving the attention of the Commission, with a view to achieving a quick resolution of the isues to the satisfaction of all stakeholders, particularly, members of the insuring public.

    He said: “The resort to the Bureau for settlement of claims disputes by the insuring public, is an indication of the level of awareness of this channel of dispute resolution in the Commission.

    “Insurance companies have been made to accept the fact that it is no longer business as usual, as their responses and compliance with the Commission’s directives had witnessed an improvement compared to previous periods.

    “Consequently, not less than 85 per cent of the insurance institutions responded to queries or directives issued to them for claim settlement during the period.

    He said majority of the 15 per cent residual, are largely claims already before courts of competent jurisdiction and therefore prejudicial for the Commission to intervene.

    He said the complaints received this year were mainly those involving non settlement of claims on Motor Insurances, Marine, Life, Bond Issues and Pension matters, stressing that the complaints were received from individual policy holders, beneficiaries, government agencies, SERVICOM, Legal Aid Council and Public Complaints Commission.