Insurance regulator, the National Insurance Commission (NAICOM) is optimistic that with new relationship existing between the Commission and the operators, consumers will have enhanced benefits in 2018 and beyond.
According to Mohammed Kari, commissioner for Insurance who spoke during a television interview with Channels under the theme ‘Analysing State of insurance”, efforts were being made to strengthen the capacities of insurance companies to be able to meet their claims obligations to consumers.
Kari said the NAICOM like any other individual and corporate organisation have reviewed its activities in 2017, and made resolutions for 2018.
“We are hopeful for the new year. We have set priorities for 2018 vis- a-vis what we did in 2017”.
Kari measuring insurance industry performance based on premium generated and level of penetration does not really reflect the growth in the industry, because it looks as if nothing new is coming in where a lot of new businesses were being done.
He said the reason for this is the insurance operators have been busy competing on rates, which undermines growth in volume as well as ability to meet claims obligations.
“To tackle this challenge, we are going to focus this year on monitoring rates on risks placed in the industry particularly the compulsory lines of business”.
We have come up with a policy on rates which has spelled out minimum rate per risk, and we hope this will enable them grow in capacity to be able to meet claims obligation because it is our priority to protect the consumer.
NAICOM had recently released a rate guide for compulsory insurances, in a bid to end rate cutting, unhealthy competition and inability of operating companies to meet claims obligation to policyholders.
NAICOM, whose core responsibility is to protect insurance consumers that pass their risks to insurance companies, warn operators to ensure strict compliance, assuring that the Commission will monitor adherence.
Affected policies include statutory Group Life Insurance, Builder’s Liability Insurance, Occupier’s Liability (public building) Insurance, Healthcare Professional Indemnity Insurance and motor third party.
In a circular signed by Leonard Akah, acting director (A & P) on behalf of the Commissioner for Insurance, made available to BusinessDay at the weekend, “Insurance operators are directed to henceforth adhere and comply with existing approved premium rates for all Compulsory classes of Insurance.”