The Nigerian insurance industry is set for a double, first is the preparation for a lift off into space of risk based supervision; second, is the review of third party motor tariff set for September 2022. For motor tariff, the September month is cast in iron, with a firm promise by the regulator and operators that there will be no push back again.
The pilot scheme of the first, Risk Based Supervision, got under way in August with eight companies involved, while the second, motor tariff, which has been pushed back several times to accommodate as many opinions as possible which the regulator and operators said is necessary to avoid hard landing is preparing for a soft landing with all on board this September.
These were the highlights of Insurance Committee meeting of National Insurance Commission (NAICOM) and the operators in Lagos yesterday. The Commissioner for Insurance, Sunday Thomas said the eight companies which are the foundation for the application of RBS are going through systemic risk assessment which involves the company specific risk exposure, “It takes a holistic approach and studies the business units within the enterprise, each of which may carry varying levels of risk.” The time specific RBS trial run will be followed with the release of guidelines drawn from the pilot test with infusion of adapted global practice.
On the coming third party motor tariff, the vice chairman, sub-committee, publicity and communication, Mr. Segun Omosehin, the Commission and operators have in principle agreed to the implementation of ECOWAS Brown Card and third party motor insurance. The current tariff for third party motor is N5000.00.
The new tariff that will confine the current to the underwriting archives is in the final review slab where all interests are being sewn together with the sub region in focus and Omosehin said “we are hopeful that this will be concluded on or before ending of the month of September, 2022.”
On Risk Based Supervision he said “I can announce to you that technically we have commenced Risk Based Supervision. The pilot phase has commenced with about eight companies to enable final adoption and guidelines to be released across the enter market.”