Committed to spread insurance across the country’s huge population, the National Insurance Commission (NAICOM) is about licensing State Insurance Providers (SIPs) across the 36 States of the federation including the Federal Capital Territory(FCT), Abuja, as a new alternative insurance distribution channel in the country.
The SIP, it was learnt, would be an agency of a state government licensed by NAICOM to provide intermediary services as defined by the guideline issued by the commission and also remunerated as by provision of the operational guideline.
Speaking at a seminar in Ibadan, Oyo State, last week, the Commissioner for Insurance, Alhaji Mohammed Kari said the operational guideline for new distribution channel has already been concluded and will become effective on January 01, 2019.
The SIP, according to him, is expected to facilitate the sale of compulsory classes of insurance within the state jurisdiction and all classes for its principal’s insurances (State Government), while additional insurance products and services would be considered in the future, depending on the success of the initial approach.
While it will also be empowered to penalise defaulters according to the laws of the States, the agency, he added, will equally maintain proper records of individuals and organisations bound by the requirements of the compulsory classes of insurance and monitoring the compliance.
Once licensed to operate by the commission, the SIP shall enter into Memorandum of Understanding(MoU) as may be sanctioned by NAICOM, with approved insurance companies in its jurisdiction for the purposes of placement and management of insurance business within a state,” he pointed out
The SIP, he stressed, shall only transact insurance business with approved insurers, saying, only insurance companies with branch offices in respective states will be eligible to transact business with SIPs.
To complement the SIP policy, he promised that NAICOM would open 20 new branch offices across the states of the federation for strict management and enhancement of insurance penetration.