NAICOM may slash licensing fees on micro insurance

Fact emerged over the weekend that the National Insurance Commission (NAICOM) may be planning to slash licensing fee for micro insurance operation in a bid to allow more participation in microinsurance business.

Currently, the commission, it was learnt, is reviewing the micro insurance guidelines to pave way for issuance of licences for operation at different strata of the nation’s economy.

Speaking on this development, Commissioner for Insurance, Alhaji Mohammed Kari, noted that operators could be issued licences to operate within a locality without necessarily running around the nation in search of business.

Currently, he stated that NAICOM has issued one stand alone micro insurance licence and that another applicant has just been interviewed.

According to him, “We have at the first level of implementation, allowed micro insurance and Takaful be sold through windows. The next level is to see if we can let them stand alone and we are in the process of reviewing the guidelines for micro insurance and Takaful.”

For micro insurance, he said, nine companies are presently selling the products through the convention access, while three firms are selling Takaful products through windows.

“What we are trying to do for the special classes, is to see if we can stagger the licence. This is because what our law provides for now, is just a licence, which by implication, is just a national licence or a licence that gives operators access to operate anywhere. And with paid up capital of N200 million, most operators may not be able to operate in more than two units,” he noted.

Stating that the new move of the commission, will encourage investors to come and get smaller type of licence that would enable them operate in small areas, he stressed that the commission hopes to bring down the licence fee and issue people licences to operate either on national, state or as a unit micro insurance outfit.

To him, “An operator could be issued a licence to operate within a market, that would enable the operator to be closed to the consumers. We are looking at this as a way to increase participation and deepen the market.”