The National Insurance Commission on Monday said it would open six branches before the end of 2016 as part of efforts to improve insurance penetration and relationships with state governments.
The Commissioner for Insurance, Mr. Mohammed Kari, said that the number of planned new branches was reduced by 50 per cent due to the present economic crises.
He said, “One fundamental development in the opening of the branch is, because of the recession, we had earlier budgeted to open 12 branches.
“But we will reduce it by 50 per cent now because the year is already gone.
“We will try and achieve at list 50 per cent of that before the end of the year so that at least next year we can make up for more.”
Kari urged state governments to domicile the laws of insurance in their various states as was done by Lagos Government to allow for easy enforcement of the regulator.
The commissioner said that some states, including Gombe, had promised to domesticate insurance laws.
He stressed the importance of having insurance locations directly in states as it would ensure proper monitoring and implementation of insurance policies.
He said, “We are very hopeful because when we have locations directly in states, we can, on a daily basis, follow them up.’’
He expressed regret that the current economic recession had affected the industry negatively as the premium collected was a factor of how well consumers were doing.
He said, “Because there is recession, some people will not necessarily sell their cars, but may park it and reduce their comprehensive cover to third party fire and theft only.”
He said that the commission focused on certain necessities that would change the fortunes of the sector in the country such as re-branding the industry.
Kari said a road-map for the Risk Based Supervision had been released which might affect the operations of insurance companies in the country.
He said, “Capital review or structural review will definitely affect the fortunes of the companies because there are components of the risk based supervision that may require financial expenditure.
“We have also had extraneous issues coming in to delay or sometimes frustrate projects we have anticipated.
“For example, there is a possibility that the Financial Reporting Council (FRC) code of governance recently released may affect the operators of our industry beyond what we have planned in 2017.”
NAICOM is a statutory agency of Federal Government established by law to regulate and supervise the Nigerian insurance sector.
The commission derives its regulatory powers from the National Insurance Commission Act 1997 and the Insurance Act 2003.
The principal goal of the commission is to ensure effective administration, supervision, regulation and control of insurance businesses in Nigeria.
(NAN)