The imminent entry into the Nigerian insurance market by two bank connected entities and owned investment company, Heirs Holdings, will benefit the sector. They have applied for insurance licences.
Mr Ekerete Olawoye Gam-Ikon, insurance, strategy and management consultant and analyst, told businessAmlive.com, “These new companies are coming from environments where governance is a big issue and having succeeded there, they cannot afford to fail in the insurance sector and in Nigeria.”
Mr Gam-Ikon said, “The coming of these companies, mostly affiliated to banks, mean that they will solicit patronage from the bank’s customers or create products that the customers will buy.”
But he also believes that the regulators have a lot of work to do in putting the insurance industry on proper footing, challenging them to ensure regulatory and supervisory environment is right, adding, “This is the time to make strong statements about risk-based supervision and making the portal work, so compliance can be enhanced.”
He believes that, as things are now, the regulatory environment is falling short. For instance, he said there are six insurance companies currently under the management of NAICOM, the regulator, and that these companies are insolvent and have violated insurance laws especially the inability to meet their obligations to policyholders, employees and regulators, thus giving the industry a bad image. He called on the National Insurance Commission (NAICOM) to withdraw two or three licences from among this group.