Fire Underwriting in the Nigeria insurance market is witnessing a rebound from the loss position it was restricted to a couple of years ago to a position reinsurers can experience a sigh of relief that losses several years back have gone with the wind the that blows.
Left with no option, reinsurers instructed underwriters that they were no longer in the position to provide reinsurance services at the prevailing rates in the market. Insurers tried unsuccessfully deflate it but in the end got a pushback and new underwriting rules set in. Reinsurers firm push yielded a genuinely long lasting intervention rather than a flash in the pan. The market moved from soft to hard and this was communicated to clients.
Speaking on the sidelines at the 2nd Annual Lecture of the Laspotech Insurance Graduates (LIGs) at NCRIB Brokers House, Yaba Lagos, the Managing Director, United Africa Insurance Brokers Yombo Bammeke, said the firm stand taken by reinsurance has rein back underwriting discipline and adequate fire rates.
Bammeke said the issue was not about the frequency losses that had occurred but the pressure point arising from poor fire rates that was eroding the pool of fire premiums. He said the market was sagging under the burden of unending cracy discounts sometimes up to 50% which were intolerable for adequate underwriting and unsustainable.
He said now the market can adequately meet its fire claims obligations without strain, the crazy discounts days are gone and could apply now is the global 5% no claims discount standard.
