The National Insurance Commission, NAICOM, says it is stepping up efforts to close the yawning insurance gap in the country through collaborative actions with key organizations.
The Commissioner for instance Mohammed Kari who made the disclosure expressed the importance of inter agency collaboration to fully actualise the target.
Kari who spoke at the Risk Frontiers West Africa 2018 conference in Lagos, said the Commission has engaged in specific regulatory initiatives, including improving insurance penetration and insurance literacy level and the Proposed Tier Based Solvency Minimum Capital (TBMSC).
The Commissioner who spoke through the Director for Inspectorate, Pius Agboola, said NAICOM has improved insurance penetration by introducing stand-alone full license for Micro Insurance organisations while two Takaful Insurance licenses have been issued, adding that Bancassurance partnership with conventional banks has started while microfinance banks are in progress
“Partnership with relevant agencies and state governments on compulsory insurances implementation is in progress while distribution channels are being expanded. Co-ordination with relevant government agencies for effective insurance of government assets is ongoing while we have partnership with relevant government agency like Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) on agriculture index insurance.”
According to him, The Commission partnered the operators on awareness creation through the medium of Insurers’ Committee; partnered with foreign development agencies for sponsorship; reinforced our zonal and branch offices on insurance education at their domain.
Speaking further, Kari said. “On the proposed TBMSC, we plan to encourage specialisation among insurers; strengthen insurer’s capacity; Improve insurance penetration; attract foreign investment; and Encourage healthy competition. However, the importance of collaboration towards reducing insurance gaps in developing nations cannot be over-emphasised.”
He said the collaboration between NAICOM and other foreign regulators is crucial for experience sharing.
According to him, collaboration among insurance operators, other operators, NAICOM and other partners such as EFInA, GIZ (a German Corporation for international o-operation), A2II (Access to Insurance Initiative), MFW4A (making Finance work for Africa), among others, cannot be over-emphasised.
He said insurance should be perceived not as a protection mechanism, but more importantly as a partnership that allows individuals and businesses to spread their wings and go to where otherwise they would not have dared to.
He noted that one important observation to make is whether individuals and businesses have been able to spread their wings everywhere to enable them take un-imaginable risks and enjoy the associated rewards.
The answer, he said, is the existence of insurance gap, which he described in his presentaion as the insurance protection gaps.
Speaking on insurance protection gaps, he described uninsured losses as a proportion of total economy losses; uninsured people as a proportion of the total population; insurance actually purchased against economically beneficial coverage; actual insurance penetration against benchmark and financially excluded adults in insurance as a proportion of total adults of a country.
He highlighted noticeable insurance gap areas for mature markets and economy as natural catastrophes, cybercrimes and risks; healthcare; pensions; and emerging risks.
For frontier and emerging markets such as Nigeria, he said there are noticeable gaps in all areas.
He, however, noted that insurance gaps in certain types of insurance may be more pronounced in one country than the other and that NAICOM has been trying to bridge the insurance gaps by working at root causes and providing remedies.