Nigerian insurance sector: From jump-start to jump-growing

CHUKWUMA ONONIWU

Chukwuma Ononiwu is a doctoral fellow ICRMP-UK, DR.ICRMP-UK, FCILRM-NG, ACILRM-NG, an alumnus of Abia State University and Pan Atlantic University Lagos Business School, a certified professional insurance broker, and a certified risk management professional. He can be reached through riskswisepro@gmail.com and +234-903-596-8732 (WhatsApp only).

A plethora of thanks is due the dynamic executive management of the National Insurance Commission (NAICOM) for its seamless collaboration with the Nigeria Police and the Federal Road Safety Commission (FRSC), which has led to a major uptick in the procurement of third party motor insurance policy. This has equally led to an increase in the share price of insurance firms and simultaneously an increase in the market capitalisation of quoted insurers, weeks after the commencement of the compulsory enforcement of the procurement of genuine motor third party insurance policy, which is the legal requirement for any motor owner to have.
However, it is not yet UHURU. The NAICOM should press the full throttle by going the needed extra mile in its collaboration with the Police and the FRSC to raid the motor vehicle licensing offices, the motor parks, the N.U.R.T.W. offices, the N.A.R.T.O. offices, etc, to confiscate all fake motor insurance documents/insurance forms/cover notes which have for long been banned. This should equally be done in the maritime sector to get rid of all fake marine insurance certificates, cover notes, pre-printed forms, etc, which again, for long have been banned. The raid, should zero in on Apapa, the neighbourhoods of Apapa, the business centres in Apapa, e.t.c. in Lagos State. These places have for long become the purveyors of fake marine insurance documents bearing the names of insurance companies that have been delisted for long by NAICOM, and even the names of operational insurance companies but with different spellings; for instance, Cornerstone typed as Kornerstone, and devoid of the essential features of a genuine marine insurance policy certificate.
Other classes of insurance that need government’s compulsory enforcement are: Building in course of erection insurance policy for three floors and above; the compulsory procurement of bond insurance as a prerequisite for the award of government contracts from federal government to state government, to local government. Same for procurement of public liability insurance policy as a prerequisite for the award of government construction contracts that impact on the public safety, for instance construction of major flyovers, major bridges, major dams, etc. NAICOM in collaboration with the Police and the FRSC, should enforce the procurement of a minimum goods-in-transit insurance policy by hauliers. This, certainly, will go a long way to reduce the carnage on the interstate express roads and on the intrastate express roads with its consequential losses and consequential damages to government infrastructure. Going further, the federal government should enforce the deduction at source from the monthly FAAC allocation to states, the premium for the group life assurance policy of state government civil servants. Same for the premium for the group personal accident assurance policy. Same for Pension.
These deductions should be administered by the Office of the Accountant General of the Federation and the Office of the Auditor General of the Federation, backed with a firm of forensic auditors report, to eliminate ghost workers. There should be checks and balances/oversight by the legislative arm of the government, the EFCC and the DSS, to avoid any mind boggling embezzlement of disbursed funds. It is clear that the ontime real time payment of these benefits to civil servants, will on the minimum, cascade to a reduction in corruption in the civil service, as the civil servants, will be rest assured of a social safety net when life happens and on retirement.
Going further, there is need for enforcement of compulsory fire insurance premium payment in areas such as the central business district of Lagos Island which is bereft of town planning, with the result that shopping malls/shopping plazas/shopping outlets, are built very very close to each other, with the consequential spread of a fire like a hurricane and the consequential destruction of taxpayers’ government infrastructure. The above outlined template will, in the long run, shore up the contribution of the insurance sector to the GDP of nigeria.
There is a glaring need to wake up the sleeping giant.

This series will continue next week.