Group tasks regulator to protect sector from unethical practices

Insurers under the Risk Management and Compliance Committee of the Nigerian Insurers Association (NIA), have tasked the National Insurance Commission (NAICOM), to save the industry from unethical practices to redeem its image.

The Committee, in a report presented to the Association, said the image challenge has remained critical among others diverse problems facing insurance business across Nigeria.

“NAICOM should continue in its efforts to free the industry from unethical practices in order to regain the image in the industry,” it said.

It noted that a good number of these challenges are connected to the conduct of insurance operators and brokers, whose conducts have continued to damage the industry’s image.

The group further identified other unethical practices clogging the wheel of progress in the industry. These include: failure to pay claims to policy holders promptly; rate cutting to beat competition; and bid rigging by insurance brokers.

Others are giving misleading and incomplete information on insurance products; misrepresentation of terms and conditions while selling products to customers; concealing limitations in companies’ ability to provide services and a host of others.

According to the committee, these vices have led to the very low level of insurance penetration, and contribution of less than one per cent to the nation’s Gross Domestic Product (GDP).

The Chairman, Mutual Benefits Assurance Plc, Dr. Akin Ogunbiyi, believes that if there is going to be any paradigm shift in the industry, the revolution has to start from NAICOM.

He argued that those behind these vices are well known, and accused NAICOM of not sanctioning them, saying: “The insurance industry is plagued with ineffective self-regulation coupled with statutory regulatory challenges. We know the people who are behind where the industry is today, yet the regulator has not deemed it fit to sanction them.

“Most decisions will fail when the parameters are not right, but decisions that are taken on sound business ethics and there is commitment to following through, will succeed. If there is going to be any paradigm shift, the revolution has to start from the regulator.”

The Commissioner for Insurance, Mohammed Kari, said NAICOM would hit hard on unethical practitioners, vowing to withdraw their licences, and sack the managing directors of defaulting companies.

According to him, NAICOM will channel its energy on instituting appropriate premium rate for the industry in 2018.