BY NKECHI NAECHE ESEZOBOR-—-The National Insurance Commission (NAICOM) on Thursday said the commission has recieved the recapitalisation plan of insurance companies.
The acting commissioner for insurance, Sunday Thomas disclosed this today at the insurance directors’ conference with the theme: “Corporate Governance ‘ The panacea for sustainable growth and development of insurance in Nigera” held today in Lagos, that the commission is currently collating the report and will commence the review soon.
He said the reports submitted by the companies on their recapitalization plans has been good.
” I can only encourage sustained efforts at earlier completion of the plans.”
He further said that the Commission is engaging other relevant regulatory bodies and agencies of government for possible palliatives that will reduce the cost of recapitalization and the response is looking good.
On the conference, he said “in the last few years, the insurance industry has witnessed series of changes owing to reforms embarked upon by NAICOM. These reforms include financial reporting, No Premium, No Cover, Corporate Governance Code, Risk Based Supervision, Information and Communication Technology advancement, Financial Inclusion, Claims Settlement, Market Conduct, Expansion of Distribution Channels, Recapitalization with all aimed at building confidence, trust and enhancing our market value and profitability.
“The Commission shall continue to introduce new reforms and initiatives in line with international best practices in our march towards achieving the full potentials of the industry.
“The Insurance in Nigeria with a contribution to the nation’s GDP at less than 1% has underperformed its potential especially when compared with other sectors in the financial services industry.
” I believe that once we can successfully navigate this corner, we could be on our way to entrenching a financially solid, vibrant, viable and active insurance market that would bring about not only an increase in penetration but a substantial increase in the industry’s contribution to GDP. The will also simulate accumulation of long-term funds for infrastructural financing, job creation, and an improved Return on Investment.
” It is long overdue that we make changes in the right direction. Successful economies are characterized by a strong investment culture of which the insurance industry plays a vital role. So we literally need to re-energize the insurance industry and commence playing our key roles in boosting and growing the sector. “
He noted that the position of the Board of Directors is key in achieving a high level of efficiency in an institution corporate governance structure. It is for this purpose that the theme for this workshop “Corporate Governance: The Panacea for Sustainable Growth and Development of Insurance Business in Nigeria” has been carefully chosen as a wakeup call for board directors.
The NAICOM BOSS added that the low level of effectiveness of corporate governance oversights in the insurance sector remains one of the major regulatory concern to the Commission. This is for the simple fact that the failure of corporate governance in the year’s past, have played a prominent role in the death or distress of most corporate organizations the world over, Nigeria inclusive.
“Over the years, the Commission has made attempts at entrenching good corporate governance culture in the insurance sector. The development and issuance of Corporate Governance Code in 2009 and the Market conduct guidelines in 2014 are among efforts of the Commission in this direction.
“Let me state here for emphasis that the primary role of the Board either in a private or public entity remains the oversight of management to ensure the corporate goals, vision, mission and values of the entity are strictly upheld at all time.
“The board is also expected to ensure the financial soundness and general wellbeing of the organisation by monitoring the management, to guarantee effective and efficient deployment of human and capital resources in the overall benefit of all stakeholders. The observance of this role has been lacking in some of our companies and which has contributed in no small measure to the challenges facing these companies today.
“It is our firm believe that members of the board can effectively perform their roles without necessarily interfering in management functions
“It is the desire of the Commission to work with all stakeholders including Members of the board of directors to reverse this trend.
“it is imperative for me to remind us here that your companies are in the business of insurance primarily to settle genuine claims made by policyholders. In all policy formulations of the board I am appealing that the prompt settlement of claims be given a high priority.”
