The committee of insurers revealed that plans are being finalized to empower the National Insurance Commission (NAICOM) to announce a new rate for the third-party auto insurance policy by January 1, 2022.
The new rate, which will be an upward revision of the current premium of N5,000 paid by motorists, is the result of the discussion between the body set up by the committee and insurance operators, including other stakeholders. This was made known by the chair of her subcommittee, publicity and communication, Ms. Ebelechukwu Nwachukwu, during a press briefing on the results of the meeting of the insurers’ committee held in Lagos.
According to the Nigeria News Agency, Nwachukwu, who is also managing director of NSIA Insurance Ltd, said the committee working on the review by the Nigeria Insurers Association (NIA) would conclude and submit its report to the regulator of ‘by November. .
What the spokesperson for the insurance committee says
Nwachukwu said: “By January 1, 2022, the regulator should be able to announce a new scientific award for the third-party insurance policy that will also include the ECOWAS brown card. ”
She said the committee had interacted with representatives from ECOWAS on how to process and issue the ECOWAS Brown Card with car insurance and how it would work in the Nigerian market, in addition to highlighting some key risk groups that he would use to measure insurance companies during their visit for risk-based supervision (RBS).
She listed the risks as: credit risk, liquidity risk, market risk, insurance risk, operational risk, legal regulatory risk, compliance risk and strategic risk.
She said, “NAICOM performed an RBS test in five insurance companies and, following the results of the company assessment, the regulator highlighted the risks. Highlighting risk is good for underwriters, so we can go back internally to make sure our reporting is standard when it comes to reporting RBS to the regulator. ‘‘
Regarding International Financial Reporting Standard (IFRS) 17 which is expected to be launched by January 1, 2023 for financial institutions, Nwachukwu said the regulator and operators are working closely on its implementation.
She said, “NAICOM has had discussions with many insurance companies about the implementation of IFRS-17, mostly from the NIA. A policy and methodology working group has been established to develop an implementation guidance note. ”
What you should know
- The Committee of Insurers, like the Committee of Bankers, includes NAICOM and the Managing Directors (CEOs) of insurance companies in Nigeria and was inaugurated on November 19, 2015 by then Minister of Finance Kemi Adeosun. It operates under a mandate to activate the insurance industry change agenda and strategically reposition the industry.
- Recall that in July 2021, NAICOM and insurers decided to increase the current insurance premium paid by motorists to obtain compulsory liability insurance after a stakeholder meeting in Lagos, the first after containment of Covid-19
- The chairman of the publicity committee of the insurers committee, Ms. Ebelechukwu Nwachukwu, said the committee has set up a body to discuss with operators and come up with a new rate to be paid by motorists on the policy.
- She said Insurance Commissioner Mr Sunday Thomas, following a reactivation of the Committee of Insurers, had asked insurers to determine the adequacy of the current premium for the third party auto insurance policy.