Insurers seek growth driven ligislation in new Bill

The Consolidated Insurance Bill currently being reviewed by a government committee would serve the industry better if it focuses on legislation which drives market development, insurance operators say.

The operators further say that given current economic realities and low onsumer appetite for insurance in the country, the Bill should strive to expand market opportunities that will strengthen local capacity, grow premium income and expand consumer interest.

Paschael Egerue, managing director, Enterprise Insurance Brokers Limited, said the belief in some quarters that the review should focus on non-payment of claims, would be a misplaced priority, as non-payment of claims is no longer a problem in the industry.

According to Egerue, mere implementation of ‘No Premium, No Cover Policy’, a provision in the Insurance Act a few years ago, released to the industry a lot of funds to boost operations and strengthened their claims payment ability. “What this in effect meant is that most problems of the industry are not with ability to pay claims, but are located with the consumers.

“The law therefore should focus on how to create good consumers to match the current abilities of the insurance industry, and any review of the insurance Act that does not seek ways of increasing the premium generation capacity of the market would be an effort in futility,” Egerue contends.

“Insurance practice in Nigeria has improved. All it needs is business. Let us create the business. Let the insurance Act be reviewed holistically for more positive purpose than the mandate given to the committee. Let it be made progressive and pro-market”.

Julius Adegoke, a marketer, worried about the regime of sanctions in the market and why the proposed Bill seeks to increase the powers of the regulator, warned that it must be properly looked into, “so that we do not create incurable problems for the market.

“I think NAICOM’s role was better interpreted in the past, when it worked hand in hand with the Central Bank of Nigeria (CBN) to deepen the financial industry, when it collaborated with PenCom to widen the scope of group life assurance, when it took the war to the government to ensure it pays its premium, when it dug out compulsory insurances out of our laws and sought for their implementation.

“The empowerment that the regulator needs if it doesn’t have it, is empowerment to aggressively develop the market and not empowerment to hand more sanctions,” Adegoke noted.

Kemi Adeosun, minister of finance, said at the inauguration of the Committee for the Review of Insurance (Consolidated) Bill two weeks ago, that the bill was being reviewed so as to ensure that it meets all the basic tenets of a Framework Law or a Principle-based legislation.

“Make a comparative review of the Draft Insurance (Consolidated) Bill to align it with the power of other financial services regulators in Nigeria.”

Adeosun further charged the Committee to examine current market problems and recommend well thought out regulatory powers to allow the insurance regulator act appropriately.

The Committee will also as part of its assignment, review all other Insurance laws and update the Draft Insurance (Consolidated) Bill to align with international best practice; make such other recommendations as  may be deemed necessary for the overall good of the Insurance Industry.”

Chaired by Omogbai-Omo Eboh, a renowned expert in Insurance Law and Talmiz Usman, head of Legal Department, NAICOM, as the secretary, and having been given 90 days to submit its report, the Committee will also identify other Nigerian Laws which conflict or compliment the activities of the insurance sector, with a view to advising government of the need to merge, consolidate or repeal, so as to have a seamless functional regulation for the sector.

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