Matthew Otoijagha
The Commissioner for Insurance, Alhaji Mohammed Kari, has said proper regulation of the Nigeria’s insurance sector will lead to the rapid growth and development the economy.
Disclosing this at a forum in Lagos, recently, Kari said the recent growth witnessed in the industry was as a result of strict regulations to ensure that the conduct of insurance business in the country is guided by strong adherence to insurance guidelines, as well as, good corporate governance.
He explained that the reason for regulation of insurance in the country is even more relevant today than five or ten years ago. He also said that this has minimized unhealthy competition, that is, rate undercutting that routinely causes insurers to go out of business, leaving consumers unable to be indemnified upon filing a claim.
According to him, while regulation has increased financial inclusion, access to credit and creating deeper reserves of investment capital at individual and collective levels, this is also promoting compliance and reaching regulations’ outcomes, improving policies, institutions and practices.
Said he, ‘‘Maintaining a fair, safe and stable insurance sector for the benefit and protection of the interests of policyholders and beneficiaries to an insurance contract is one of the benefits of regulation.’’
He said that the regulator is addressing the increasing presence in the market of insurance groups and financial conglomerates, as well as, financial convergence adding that this has further promoted confidence in the financial stability of the insurance sub-sector of the financial system.
He said that the regulator is addressing the increasing presence in the market of insurance groups and financial conglomerates, as well as, financial convergence adding that this has further promoted confidence in the financial stability of the insurance sub-sector of the financial system.
On compliance expectation, Kari pointed out that Nigerian insurance institutions must have respect for the regulator, its rules and regulations, adherence to the laws and regulations of the land, healthy competition and good market conduct, as well as, adherence to the Code of the Corporate Governance.
He charged the operators to embrace effective and efficient risk management practices and processes, eschew unhealthy market practices, rate cutting, return premium, market cooperation and self-regulation.
Kari stressed that effective insurance regulation enthrone good market conduct which ensure fair treatment of the consumers, financial inclusion, incentivize risk reduction behaviors and facilitating economic recovery after a loss has occurred.
Kari stressed that effective insurance regulation enthrone good market conduct which ensure fair treatment of the consumers, financial inclusion, incentivize risk reduction behaviors and facilitating economic recovery after a loss has occurred.
Consequently, he said, regulation is an essential part of increasing access to insurance, while advancing economic growth, sustainable development and human dignity.