Commissioner for Insurance Mohammed Kari made this known while speaking at the 2016 Annual Chief Executive Officers Retreat of the Nigerian Council of Registered Insurance Brokers (NCRIB) held in Ilesha, Osun State. The theme was: Growing Insurance Amidst Regulations.
Kari said these activities are illegal, criminal and punishable under the laws of the country. He warned brokers and underwriters alike to beware, adding that the Commission has beamed its searchlight on the firms. He noted that the unrepentant companies and individuals engaged in these schemes would answer for their deeds
The commissioner lamented the increase in number of brokers that are regrettably yet to reflect on the level of insurance penetration in the country. He said: “Indeed the Nigerian Insurance market has grown in the last decades. There has also been a substantial increase in the number of players and activities; although and regrettably too this increase in the number of players especially brokers is yet to reflect on the level of insurance penetration in the country.
“The only possible explanation for this could be that intermediaries are not creating new business neither are they expanding their operations beyond the major cities of the country and around a few clients that are already converted insurance consumers. This should be of serious concern to any right thinking professional.
“The face of regulation has changed over the years, but the objectives and purposes have continued to be providing comfort and confidence to the consumers while at the same time developing the market.”
He stressed that the task of market development is everybody’s, however; it is the trend to quiz the regulator why market penetration is low.
He said penetration would continue to be low if everyone would only operate from the comfort of the metropolis or chase only existing clients with insurance policies.
“The poor penetration of insurance in the country is no more a new statement or information. It is a position we all certainly cannot be proud of. What should be done in this ugly situation is the issue. Developing a robust insurance sector in any country requires developing a good strategy on insurance penetration.
“While the newly formed Insurer’s Committee has set up various sub committees to look at that and more issues, the Commission is complementing those efforts by expanding its enforcement of compulsory insurance’s down to the states level. In the process we sadly found all sorts of under the table arrangements where insurance policies are being offered in conjunction with various state governments to unsuspecting public, sometimes with registered brokers and in most cases with unregistered and unlicensed entities.
“This is Illegal, criminal and punishable under the laws of the country. Brokers and underwriters alike should beware as we have beamed our searchlight to that direction. Unrepentant companies and individuals that are engaged in these schemes would answer for their actions.
“We have also identified the limited channels of distribution as a major inhibition factor to penetration. In this regards, we have considered the creation of additional distribution channels and have gone far on the preliminary works and draft of guidelines which would soon be exposed for input,” he added.
Kari said it is expedient to note that prior to the recent economic challenges, pressure was building for the insurance industry to be more flexible and to approach business in a more dynamic fashion.
He urged insurance institutions to find a way to break out of the soiled systems which perpetuate a limited view of the customer.
It is this view that impresses on us that we are doing well when we snatch a client from another or when we get on a long list of the brokers of a fat government client, though adding no value at all. New models of business and enterprise architecture need to arise; where integrating with newer technology solutions and effecting process improvements that leverage the capabilities of existing personnel and applications can become the norm, he added.
Source: The Nation