Nigeria: NAICOM issues revised guideline on Bancassurance

The National Insurance Commission (NAICOM) has rolled out revised guidelines on Bancassurance.

According to NAN, the Chairman of the media subcommittee of the Insurance Industry Committee (IIC), Jide Orimolade, disclosed this at a news briefing at the end of the 13th IIC meeting in Lagos.

He explained that the development would enable insurance companies to partner with many banks rather than dealing with only one bank at a time.

Fair play by parties: He explained that the new guidelines were laudable and would ensure fair play by operators in the insurance market.

He added that this would disable exclusivity, which is also in line with the Central Bank of Nigeria’s regulation that prescribes that a commercial bank cannot propose the product of only the insurance company they were partnering with to a consumer.

More update: speaking to plans for the microinsurance segment, Orimolade noted that there is work in progress to review the share capital of the microinsurance segment in terms of market development as proposed by an IIC subcommittee.

On the proposed increment of the premium for the third-party motor insurance policy, Orimolade said that there were processes for increasing the rate. He further explained that the process for the revised premium rate for the third-party motor insurance policy had reached a point of approval by the Governing Board of NAICOM.

Following the board’s assent, he said the draft approval would be forwarded to the Minister of Finance for concurrence. Until then, he said the proposed amount for the policy cannot be disclosed because the minister cannot be preempted.

IFRS 17: the subcommittee chairman said insurance companies were expected to prepare their financial statements in compliance with the IFRS -17 from January 1st, 2023. He added that the insurance companies were ready for the IFRS-17, though there could be issues to address.

Industry performance: Rasaaq Salami, the Head of Corporate Affairs and Market Development at NAICOM, opined that the industry had not done badly, as there had been lots of positive activities within the industry. He said:

• “Lots of indices are looking upward for the industry this year, which is very encouraging because of a number of factors, such as the IIC meeting. The IIC is a meeting point for regulators and operators to resolve issues and also come up with common processes and objectives on what should be done.
• “This has helped in improving the performance of the industry and gradually reducing friction between the regulator and the operators. We hope that the situation will be maintained in the coming years.”