• Friday, July 19, 2024
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BusinessDay

Changes expected in local market with new foreign investments

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The nation’s insurance industry in the last few years has been largely shaped by the influx of foreign investors, and growing enquiries by many others to own equity stake in the local market.

This development has not only woken up local firms that have been reluctant to embrace change, it has brought about a new era in consumer relations and service delivery.

With no fewer than 12 foreign firms having equity in the market today under different arrangements, the market is expected to witness innovations in product development, customer service and capital outlay, says Victor Coker of Premium Matters.

“What this has done is to awaken sleeping firms that have refused to embrace change that there might be danger ahead as forward looking firm might be considering at growing their size with more mergers and acquisitions in the future, Coker stated.

Chibudom Nwuche, chairman, governing board, National Insurance Commission (NAICOM), told industry operators recently that the sector has a huge potential waiting to be tapped and this has enhanced its attractiveness to investors.

“A good evidence of this is the increased number of foreign investors that have taken equity interests in insurance institutions in Nigeria. In specific terms, there are now over 10 Nigerian institutions with significant foreign ownership as against just three five years ago and more foreign investors are making enquiries on requirement for participation in the Nigeria insurance sector, Nwuche stated.

According to him, the governing board of NAICOM was looking at strategic initiatives that would help realise the growth potential in the sector and some of them he noted include:

Deepening insurance penetration in Nigeria: In addition to the ongoing efforts to facilitate compliance with the laws on compulsory insurance, the governing board is ensuring the successful implementation of the financial inclusion initiatives such as Micro insurance and Takaful insurance.

“I expect you, the industry operators, to take advantage of this window of opportunities to grow your business and increase your share of the market.”

Strengthen Insurance Institutions: The Governing Board will continue to support the management of the commission in ensuring: The maintenance of adequate level of capital; implementation of Risk Management Framework for insurance institution; continued compliance with IFRS by insurance institutions to sustain the integrity of financial reports; compliance with all relevant laws and regulations; implementation of ‘’No premium no cover policy” which has led to improved liquidity for insurance companies to pay claims.

Enhanced NAICOM regulatory capacity and oversight – Manpower development and effective performance management System; appropriate deployment of information and communication technology infrastructure for effective discharge of the commissions oversight functions; intensive supervision of insurance companies according to their risk profile; work towards passing of insurance bill into law; effective management of stakeholders’ expectations; conduct regular interaction and stakeholders panel to exchange views; complaint procedures and market conduct to ensure that insurance policyholders are treated fairly and that they have avenue to seek redress; support management efforts to strengthen the complaint Bureau’s buoyed by the establishment of a call contact centre for easy accessibility and prompt complaint redress management by adopting zero tolerance for non- settlement of genuine claims or delaying claims settlement.

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