On NAICOM’s overarching regulations By Taiyewo Olugbemi

Regretfully, NAICOM has to purge itself of the present “headmaster mentality” if it will get the desired cooperation with the industry and ultimately grow the sector. As at today, there is no love lost between NAICOM and most of these operators, particularly the Insurers and Brokers, due to heavy penalties which the commission is always angling to slam on them at the slightest “offence committed”

It is sad that the insurance industry in Nigeria has not been able to proof its mettle, when it comes to adding up significantly to the nation’s Gross Domestic Product as we have in many developing and developed countries.

Mohammed Kari, Commissioner for Insurance

As at today, the industry contributes less than 1 per cent (0.40%) to the nation’s GDP, depicting several bogging challenges facing it, chief of which is poor public perception, poverty of the people and unethical practices by some charlatans who go about in the borrowed robes of insurance operators.

But it remains a regret that the hope of the industry getting out of the woods may be a mirage unless there is a drastic change in the vision and modus operandi of the National Insurance Commission (NAICOM) which is the government regulatory body that supervises the industry.

While it is agreeable that NAICOM should ensure operators strict adherence to rules and ethics, in view of the fiduciary nature of insurance, the task of growing the industry in collaboration with the major actors such as the Nigerian Insurers Association (NIA); Nigerian Council of Registered Insurance Brokers (NCRIB); Institute of Loss Adjusters (ILAN) and Association of Registered Insurance Agents (ARIAN) is paramount to the industry’s robust existence.

Regretfully, NAICOM has to purge itself of the present “headmaster mentality” if it will get the desired cooperation with the industry and ultimately grow the sector. As at today, there is no love lost between NAICOM and most of these operators, particularly the Insurers and Brokers, due to heavy penalties which the commission is always angling to slam on them at the slightest “offence committed”.

This is already giving the operators the impression that NAICOM today is existing to “kill” rather than give life to the industry. It is appreciated that operators needed to adhere to extant laws to protect the integrity of the profession, but implementing such laws must be done with some human face, in view of the fragility of the industry.

NAICOM perhaps need to take a cue from other government regulatory bodies such as Securities and Exchange Commission and the Central Bank of Nigeria, to appreciate how they regulate and protect their members even during periods of obvious crisis. It should not be lost on NAICOM that the Commission will only exist and be respected if it allows itself have well- nourished and supportive operators under its control. More of the Commissions productive energies should also be devoted to growing the industry rather than shrinking it with the existing heavy levies and fines.

Taiyewo Olugbemi, is a Lagos Based Financial Analyst