Contrary to widespread claims that the ongoing recapaitalisation process would trim down the number of insurance companies operating in the industry, the National Insurance Commission (NAICOM) has assured stakeholders that the process would be beneficial for the sector.
The Details: Reacting to the claims, acting Commissioner of NAICOM, Mr. Sunday Thomas explained that the aim of recapitalisation is to strengthen the insurance sector and aid economic development.
He said this at the 2019 Insurance Stakeholders Consultative Forum organized by the Lagos Chamber of Commerce and Industry (LCCI) in Lagos.
Thomas urged other practitioners to be concerned about the growth of the retail segment of the business and the automation of insurance processes as a means to reposition the industry for better.
“Our standing the largest market in Africa in terms of population and our rating as Africa’s biggest economy are not for nothing.
“They should be able to deliver to us a robust insurance business in Nigeria. There are few key things that if we can get right at them will enable us to jump-start the industry.
“So, the drive toward financial inclusion and the recapitalisation exercise going on now in the insurance sector are efforts that give us hope that the insurance market stands and distinguishes itself in the Nigerian financial sector,” Thomas said, adding that “dependability, trustworthiness, prompt and fair claims settlement and introduction of innovative products and technology are the things that it will take to place the industry on the part of prosperity,” he said.
In addition to the NAICOM boss’s remarks, Babatunde Paul Ruwase, the President of the LCCI noted that the essence of the stakeholders’ forum was to find solutions to the numerous challenges facing the sector as well as chart a new course for the industry.
Ruwase said: “The insurance sector has not shared in the growth experienced by other segments in the financial services sector, such as pension funds, mutual funds and banks, in the last decade.
“According to the data by the National Bureau of Statistics, the insurance sector contributed 0.5% to our Gross Domestic (GDP) IN 2019 and grew about 4% in the same.
“Nigeria’s insurance industry has hardly grown in real terms in the last ten years due to major headwinds affecting players including economic and regulatory uncertainties, unwillingness of people to purchase a policy as well as cultural and religious sentiments.”
Yesterday, the number of insurance firms that secured no objection from the National Insurance Commission (NAICOM) to go ahead with their recapitalisation plan jumped to 44 from 26.