The National Insurance Commission (NAICOM) has tasked insurance operators to realise that distribution channels for insurance products must be expanded beyond the traditional norms.
This is even as it said, players must accept changes that come with modernisation and technological advancement for the industry to remain sustainable.
Speaking at the Nigerian Council of Registered Insurance Brokers(NCRIB) 2023 chief executive officers (CEOs) Retreat in Ogere, Ogun State, the commissioner for Insurance/CEO, NAICOM, Mr. Sunday Thomas, charged every arm of the sector to hugely invest in technology in order to compete or be able to meet the expectation of clients.
This, he said, becomes imperative to support the commission’s efforts to bring emergent online platforms for distribution or provision of insurance under the NAICOM’s regulatory purview in the interest of the Nigerian insurance industry.
To him, “an important issue is the need for operational standards to prevent or reduce, to the barest minimum, unethical practices which ridicule or impugn the integrity of the Nigerian insurance industry.
“It is our humble view that strong and sound firms are better able to invest in the much needed IT solutions to ease operational pain-points within the industry hence the need to dissuade portfolio broking firms.”
Insurance brokers, he pointed out, must begin to re-examine the insurance broking value proposition beyond the traditional perception, adding that, this is necessary to enable the insured public/insureds appreciate other values offered, as the rhythm has changed and people may only use services that provide priority values to them.
While emphasising that insurance brokers have very important roles to play in the collective aspiration to reposition the industry, he listed their roles to include: projecting the additional values created by the new regime of Third-Party Motor insurance cover; the NAICOM Portal; improved soundness and stability of insurers; better market conduct practices and fair treatment of insurance consumers, as well as ongoing collaboration with state governments on compulsory insurances, among others.
The recent subsidy removal by the federal government, he stressed, exacerbates the need to project the value proposition of insurance beyond the conventional perception, as there will be a ‘complex rationing’ which could further relegate insurance demand.
We must upscale our business models to attract individuals who are leaning towards creating Sinking Funds, he advised.
Stating that economic activities may reduce in the short run, he urged underwriters and brokers to optimise their management expenses in order to avoid the pressure of an off-peak period, while not forgetting to prepare for the possibility of cost-push inflation.
“I must reiterate that regulatory changes are continuous given the changing dynamics of the operational market environment. We must therefore avoid the obvious temptation to resist innovative regulatory and supervisory initiatives intended to make the industry more relevant to the economy. We cannot continue to wait; we must confront our challenges before our challenges consume us,” he noted.
Earlier, the president, NCRIB, Mr. Rotimi Edu said the CEOs Retreat has remained a permanent feature of the council’s yearly programmes bringing together top notch executives of each of the member companies for the purpose of learning, relaxation and networking.
To him, “this is an auspicious occasion for me to once again express my delight that with your cooperation, the ‘Brokers-Centric’ focus of this current leadership has been recording good success. We are all witnesses to the increasing tempo of members’ interest in activities of the council, while the same interest is being stimulated amongst insurance companies who do everything possible to collaborate with our council for their enhanced bottom-line and ultimate corporate progress.”
He appreciated AIICO Insurance Plc and Unitrust Insurance Plc for their joint support and sponsorship of the retreat, promising that the two firms would extract good value through this gesture for enhanced bottom-line.
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