Insurance World

NAICOM Assures Non- Cancellation Of Llicence Over Tier-Based Policy

Mohammed Kari, Commissioner for Insurance addressing the media at the event held today in Abuja.

 

 

 

BY NKECHI NAECHE—Ahead of October 1, 2018 commencement date for insurance companies Tier-Based Minimum Solvency Capital (TBMSC) policy, the National Insurance Commission( NAICOM) on Saturday reassured operators and investors that it will not cancel the license of any insurance company.

The commissioner for insurance Mohammed Kari gave this assurance at the 2018 seminar for insurance correspondents/ Business Editors and Bureau Chief with the theme: “Achieving a seamless implementation of the TBMSC policy in Nigeria” held today in Abuja, that there is no mandatory injection of fresh fund by insurers and at the close of the initial certification date, there shall be no cancellation.

He said the commission have no plan to stampede shareholders to inject fresh capital, adding that with the new policy every operator can play very well since there is minimum solvency capital required.

He noted that the policy support the nature, scale, complexity and risk profile of the business conducted by insurers.

He added that the aim of the regulator is to checkmate the excess of insurance companies for the benefits of the policy holders, investors and the economy at large.

He stressed that the intention of the regulator is not to kill any company but to stop them when they are getting involve in some business that is above their risk capacity.

The Director, Supervision, NAICOM, Barineka Thompson, on the benefits on the policy said the TBMSC Model – is a regulatory model designed for the application of proportionate solvency capital that support the nature, scale, complexity and risk profile of the business conducted by insurers, stressing that classification of business according to the present level of capital that an insurer possesses in relation to the risks that the capital can effectively be deployed to.
He said the policy will enable soundness and profitability of insurers through optimal utilization of capital; encourage insurers to focus on the area of their strengths, encourage innovation and deepen market penetration, build investors’ and public confidence in the industry.
Other benefits according to him, include, to create capacity for bridging insurance gap, optimize local retention and minimize capital flight; limit significant systemic risks and build confidence in the insurance industry; supports the stability of the financial system and increase insurance contribution to the nation’s Gross Domestic Product.
He posited that all the aforementioned will be achieved without a mandatory injection of capital and no cancellation of licence, but insurers will be subject to solvency control level.

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