L-R: Abideen Musa; Chioma Sideso; Ituah Ighodalo; Udo Okeke; Jean Kacou Diagou and Ebele Nwachukwu, all Directors of NSIA Insurance, during the presentation of NSIA Insurance ISO Certificate by Standard Organisation of Nigeria in Lagos.
The Board of NSIA Insurance Limited has commended the National Insurance Commission (NAICOM) on its efforts to develop and deepen the Insurance Market with the introduction of Tier-Based Minimum Solvency Requirement (TBMSR) model.
A statement by the foremost underwriter, stated that the Board believes this initiative will encourage more effective deployment of Capital and Specialisation amongst insurers
Tier-based minimum solvency capital structure is a complimentary measure to the ongoing implementation of the risk-based supervision programme by NAICOM and is aimed at supporting the nature, scale and complexity of the business conducted by insurers.
It is a three-level model that specifies the capital requirement for each tier based on risk classification for each tier.
NSIA Insurance is part of a banking and insurance Group that operates across Africa in Benin, Cameroun, Congo, Cote D’Ivoire, Gabon, Ghana, Guinea Bissau, Mali, Senegal and Togo.
The Nigeria company started operations in 1989 as Africa Development Insurance company (ADIC); Founded by Prof. Joe Irukwu.
The focus of the Group is to expand its footprint across Africa in order to develop retail and corporate channels that deepen financial inclusion. In a bid to achieve this, NSIA Insurance had, in Year 2017, started the process to increase its capital base which incidentally is very much in line with the recent move by the National Insurance Commission to develop and deepen the insurance market with the introduction of the Tier Based Solvency Capital model.
This proactive effort will now qualify the company to operate in Tier One with the capital capacity to underwrite all classes of risk.
The Board also approved the appointment of additional Directors, both in Executive and Non-Executive capacity as the company prepares to play a dominant role in the Insurance Industry in Nigeria and across Africa. These Directors have been forwarded to the regulator for approval.
According to the statement, the goal is to create market niches to deepen penetration particularly in the retail sector, to increase the amount of capital available with a corresponding increase in capacity and technology and generally to create better efficiency all of which is extremely welcome.
Under the new capitalisation structure, life insurance firms need a minimum capital level of N6 billion for Tier 1; N3 billion for Tier 2 and N2 billion for Tier 3: For non-life business, the requirement is a minimum of N9 billion for Tier 1; N4.5 billion for Tier 2 and N3 billion for Tier 3. While for composite companies (combination of life and general business), the new capital requirement is a minimum of N15 billion for Tier 1; N7.5 billion for Tier 2 and N5 billion for Tier 3.
NSIA Insurance is in good stead to increase its Capital and create additional value for all its stakeholders.