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HomeBusinessNigeria's insurance industry regulator to sanction firms over N40 bln unsettled claims

Nigeria’s insurance industry regulator to sanction firms over N40 bln unsettled claims

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Nigerian insurance industry regulatory body, the National Insurance Commission (NAICOM) is profiling companies that are lagging behind in claims payment and may impose a sanction on them to serve as a deterrent and boost the industry image.

According to industry data, over N40 billion claims filed by customers of some companies are remain unsettled and giving the industry bad image.

Commissioner for Insurance, Sunday Thomas, speaking at the 2020 insurance directors’ conference organised by NAICOM and the College of Insurance and Financial Management (CIFM said the regulator is making the move sanction defaulting firms as part of measures to reposition and strengthen the industry,

“The era of huge backlog of claims should no longer be associated with our companies, and while the commission is profiling companies with huge unsettled claims for necessary regulatory action, companies that are responsive to the plight of their clients in prompt settlement of claims are encouraged to sustain the good business conduct.

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“Our focus must shift to service delivery which will make our companies to seek more reasons to settle clients’ claims and less reason for repudiation of claims,” Thomas said.

“It has been observed that the gains of domestication policy of the government as enshrined in the Nigeria Content Development Act 2010 are gradually losing its meaning for the insurance sector.

“More businesses especially in the oil and gas and the aviation sectors are now being reinsured abroad.

“Of more concern is the declining participation of life companies in the annuity business which is the emerging business for our industry.

“These are the areas where the industry can impose itself on the economy through the control of funds for national development,” the insurance chief said.

He charged underwriters to pay attention to claims payment, especially now that the industry is fighting negative public perception.

Thomas called on insurers to be responsive to the plight of their clients by prompt settlement of claims and equally charged them to strengthen their human and financial capital for effective participation in big ticket risks.

He charged the industry players to invest heavily in technology, adding that this has remained one of the key drivers for developing the market.

He also noted that the recent crises associated with #EndSARS protest which led to the destruction of lives and properties is an eye opener and an opportunity for insurance firms to engage in massive awareness programmes on relevant insurance cover for lives and property of individuals and all businesses.

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