NAICOM

The National Insurance Commission (NAICOM) has sensitised more than 300 Nano, Micro, Small and Medium Enterprises (NMSME’s) on the benefits of microinsurance products designed to meet their needs.
The Commisioner for Insurance, Mr Sunday Thomas, said this at a one-day sensitisation workshop organised by the National Insurance Commission (NAICOM) for NMSME’s in Lagos.
He stated that the MicroInsurance and Takaful were two insurance offerings carefully designed for affordability and inclusiveness to bring insurance within the reach of the NMSME’s which are one of the nations most valued contributors to the economy .
Thomas said the products would support the NMSME’s sector for speedy recovery when unforeseen situations occur.
He noted that the workshop was designed to provide insights for the regulator to learn from, adequately protect the NMSMEs as policyholders as well as ensure a safe and sound insurance sector.
The commissioner said that the engagement would also encourage innovation and product development that meet the specific needs of the MSMEs.
” Acording to the National Bureau of Statistics (2019), NMSMEs in Nigeria have contributed about 48 per cent on average to the national Gross Domestic Product (GDP) in the last five years from a total of about 17.4 million enterprises.
“They account for about 50 per cent of industrial jobs and nearly 90 per cent of activities in the manufacturing sector.
‘In Nigeria, all development interventions of the current administration have had components focused on enabling these MSMEs sprout and flourish.
” But unfortunately with little or no insurance content to deal with associated risks and ensure sustainability and guarding them against failure,” he said.
Thomas noted that whatever gain or progress made in the NMSME’s sector could be halted abruptly in the face of a natural or man-made disaster which could often prove daunting to surmount without any support.
He stated that when MSMEs are affected by any mishap, the disruption produces not only direct business losses, but also indirect losses and economic ripple effects.
“The range of impact include job losses, debt overhang, and a relapse of households into extreme poverty.
“While the risks that expose MSMEs to this type of vulnerability may not be within the scope of human control, what is within human reach is a deliberate risk management plan through Insurance.
“Insurance gives you confidence to venture, it is that product you buy when you think you do not need it because it may be too late to buy it when the need for it arises ,” he added .
The commissioner expressed concern that the importance of insurance to lives and property, adoption and penetration had been low in Nigeria.
Thomas said that the workshop had so far been held in Kano, Kaduna and Abuja , pulling NMSMEs from these cities and their environs and the average attendance per location have been over 1000 MSMEs.
” However, due to the prevailing pandemic and the need to adhere to the protocols, the number allowed in the hall today is restricted to 300 MSMEs.
” Lagos state is a key stop for us for obvious reasons; first, Lagos has been Nigeria’s nerve center of commerce, the state hosts the single largest number of NMSMEs in the country, put at 11.5% of total. (NBS 2019)
” Secondly, and more importantly, the current and past administrations of this state have demonstrated a continuous commitment to sustaining MSME growth ,” he said .
The Chairman, Nigeria Insurers Association (NIA), Mr Ganiyu Musa. lauded NAICOM for organising the workshop as it would assist the insurers to adequately meet the needs of the small business owners.

The National Insurance Commission (NAICOM) has prospects to achieve 10 per cent penetration, N1.5 trillion Gross Written Premium (GWP) and 10 per cent increase in insurance density.
Thus the commission plans to work with Small and Medium Enterprises (SME) cohorts across geo-political zones.
Besides, the commission aims to build trust among the insured leading to more referrals; build confidence in the sector by reducing incidences of fake insurance and implementing penalty for nonpayment of claims; and work with digital companies with access to data and information for wider reach and impact.
NAICOM Commissioner for Insurance, Mr Sunday Olorunda Thomas in an interview with repoters said the commission launched Market Development and Restructuring Initiative (MDRI) in 2009 as a vehicle to, among others, drive the enforcement of compulsory insurances, reduce incidences of fake insurance and in the process grow the industry.
He stated the commission’s strategic focus is on compulsory insurances, government assets, microinsurance and takaful insurance.
He said: “Target market however is Government, Micro-, Small and Medium-sized Enterprises (MSMEs) and Millennials and Gen Z, which make up 60 per cent of our population.
“Our strategic themes include increased awareness and education; stakeholder’ grooming/partnerships; high-impact media productions; and a social/digital NAICOM
“To increase awareness and education, we will also launch a joint implementation task force with police, FS, FRSC, Ministry of Justice, Mobile Courts, Ministries, Department and Agencies (MDAs) at all levels, among others.
We will hold insurance stakeholder’s forum/town hall meetings, launch the Insurance Industry Thought Leadership Series on Testimonials and Endorsements, among others.”
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The National Insurance Commission (NAICOM) has inaugurated the Sub Working Groups (SWGs) of the Insurance Industry Financial Reporting Working Group (IIFRWG).

Commissioner for Insurance, Mr Sunday Thomas, inaugurated the group on Monday in Lagos.

Thomas said that the SWG was expected to provide guidance to the IIFRWG for the seamless adoption of the International Financial Reporting Standard ( IFRS) 17.

He said the IFRS 17 would take effect from January 2023 by the Nigerian insurance companies.

Thomas said that the SWG was constituted to help foster the country’s adoption of the IFRS 17 in line with best practice.

The commissioner noted that the commission had equally issued a ‘roadmap’ on the adoption of the IFRS 17 insurance contract for insurance industry in Nigeria since January 2020.

“The activities and timelines in the roadmap are intended to set the tone and facilitate a coordinated process and action steps.

“The roadmap was issued for general adoption by all insurance, reinsurance, takaful and micro insurance companies in Nigeria,” he said.

The commissioner said that the SWGs were constituted to assist the IIFRWG in the achievement of its mandate and ensure seamless transition to the IFRS 17.

He said that the IIFRWG had identified the following three critical sub working groups namely : accounting, disclosure and reporting Sub -Working Group.

This, he said, would assist on technical issues relating to accounting.

According to the commissioner, members of the various SWGs comprises of selected members of the IIFRWG and the co-opted members selected from the relevant organisations.

He explained that membership of each of the SWG was selected based on a member area of strength in terms of knowledge and experience.

Thomas noted that the aim of constituting the group was to ensure that the views from Nigerian stakeholders interested in insurance financial reporting issues were properly considered in discussions at the SWG.

Thomas assured that the commission would continue to give its full support to the SWGs to achieved the set goals.

IIFRWG which was an initiative of the commission was inaugurated in March 2020 as an advisory and consultative team of experts for the purpose of seamless adoption of the IFRS 17 in Nigeria.

The initiative was in line with the commission’s strategic goal to facilitate transparency and accountability in financial reporting.

In May 2017, the International Accounting Standard Board issued the IFRS 17 insurance contract, which would replace the present IFRS 4 on accounting for insurance contracts effective January 2023.

The objective was to ensure that an entity provides relevant information that faithfully represents the insurance contracts.

By Tanko Mohammed 

For the first time in 35 years, the National Insurance Commission has issued licence to a reinsurance company. 

The commission also issued licences to four insurance companies and two takaful insurance companies for the first time in 10 years. 

The Commissioner for Insurance, Mr Sunday Thomas, who issued the licences on Friday in Abuja, said it was to deepen the insurance market and expand operations in the country. 

He urged the companies to focus on products that would meet the insurance needs of the people. 

Thomas said that the commission would not hesitate to recall the licence of any company which failed in its responsibilities. 

“The last licence issued by NAICOM was about 10 years ago and so, what we are doing today is historic. 

“Some of the actions were deliberate, especially with respect to life underwriters and non-life underwriters because we had wanted people to acquire the existing companies. 

“Now, we have gotten to a point where there is need for us to deepen the market. 

“Every day we live and go to bed with risks all over us and therefore there is the need for us to expand the scope of our operations. 

” The only thing we can do is to increase the supply side. 

“The demand side is yearning for products that they can buy in and secure their future. 

“We believe that the team will do what will ensure the sustainability of the companies,’’ he said. 

The commissioner, who expressed regret over the current poor rating of the country in insurance, urged the companies to help get more people involved in the sector, especially at the micro level. 

The Chief Executive Officer of FBS Reinsurance Limited, Mr Fola Daniel, assured the commission that the company would comply with its regulations. 

“We don’t have a reason not to be compliant, we will be self-regulative in a way that the commission will not suffer headache on account of the company. 

“We will be your worthy ambassador, thank you for giving us this opportunity to add value to the insurance industry particularly, capacity to the reinsurance world,’’ he said. 

Mr Tony Elumelu, the Chairman of Heirs Insurance Limited (General), assured the commission that the company would surpass the insurance expectations of the people. 

Elumelu said that the company would work with NAICOM in engaging the National Assembly on necessary legislation to move the sector forward. 

“We understand market research, we understand what consumers want, we know how to reach them and surpass their expectations and there is always room for improvement, especially with technology. 

“We will work with this leadership of NAICOM and other industry leaders to bring about the change that will help the industry grow so that the contribution to GDP will move to three per cent under your leadership. 

“We want to make sure we take insurance to our people, have better understanding of insurance, assurance products, make sure that they embrace it and the stereotypes that exist; we will work together to educate and create awareness,’’ he said. 

The Chairman of Stanbic IBTC Insurance Limited, Mr Yinka Sanni, commended NAICOM for the speed with which the company’s application was processed. 

Hajia Saadat Mohammed, a representative of the Chairman of Salam Takaful Insurance Company Limited, said that the issuance of the licence to the company was an opportunity to encourage financial inclusion.