The National Insurance Commission will soon introduce a revised insurance distribution channel, which will replace the State Insurance Policy that was cancelled.
The new policy may involve the issuing of new distribution licenses to non-insurance bodies, who would be able to sell insurance to every part of the country, according to information obtained from the commission. The Commissioner for Insurance, Mohammed Kari, said this became necessary to replace the SIP, which was cancelled after the Nigerian Council of Registered Insurance Agents kicked against it.
Kari said that the sector could no longer continue to bear the low insurance penetration in the country, while other financial sectors were driving financial inclusion. He said that when the SIP was introduced, the commission had a meeting with the Nigerian Council of Registered Insurance Brokers and asked them to introduce their inputs, which they had still yet to do.
According to him, the brokers were already exploring the corporate business, while the micro insurance was still lagging behind. “There is no way a broker with its head office in Lagos can sell to a micro client in the village or Port Harcourt,” he said.
He noted that brokers could not have branches across the country. “Financial inclusion is unstoppable; we have to continue with it. They have to financially include the excluded people,” he said. Kari said the regulators of the financial sectors consultative committee collectively reviewed the financial inclusion strategy.
Every sector had what it was supposed to do to include the financially excluded in the banking sector, capital market, insurance, and others, he said. While stating that financial inclusion was being driven by the government, he said it was necessary to look at other channels to distribute insurance in the country.
Recall that on November 20, 2018, NAICOM released the operational guideline to commence the operations of the SIP in the country. The NCRIB served NAICOM a 30-day pre-action notice to withdraw the SIP program, which made the commission to suspend the policy in a circular on December 19.