After several years of not granting licences to new insurance and reinsurance companies, the National Insurance Commission (NAICOM) has given reasons it granted FBS Reinsurance, Heirs Insurance Life and General, Enterprise Life.
It suspended issuance of new licences for over 10 years.
The Commission said it decided to grant licences to companies based on the profiles of the people behind them and their success rates.
The Commissioner for Insurance, Sunday Thomas, who made this known to reporters in Nairobi, Kenya, noted that the commission would continue to encourage the development of the insurance sector by ensuring that capable players are welcomed into the sector.
Thomas said the Commission would grant licence to more insurance and reinsurance firms that show and have capacity to impact the underwriting sector.
He said: “Insurance and reinsurance firms licensed over a year ago, were granted approval due to their capacity to impact the insurance sector. The last reinsurance company that was approved in Nigeria before we approved FBS Reinsurance, was approved more than 10 years ago and this was the case with insurance companies of which like Heirs and Enterprise were granted licence.
“These companies were not approved because of their numbers, but we looked at the profile of the people behind them and their success rates. We believed they have the ability to impact our sector. I will be happy tomorrow, if I see anyone that has the capacity to impact our sector, I will approve the licence.”
On the alleged foreign dominance of the insurance sector, he stated that the allegation was unfounded, as Nigerians own most of the firms in the sector.
“The issue of foreign dominance should be put in the right perspectives. In terms of ownership, that may not be correct. But in terms of some level of operations, that may be right. For example, on special risks, rates are still determined abroad. But in terms of ownership the companies are owned by Nigerians.’’
He noted that though there are some foreign interest coming in, but that is not enough to tag them dominant factors.
On deepening insurance penetration, Thomas maintained that NAICOM would continue to encourage insurance practitioners to explore opportunities in the retail market space.
He said efforts would also be intensified to create awareness on benefits of insurance, stressing that the people need to know more on the benefits of insurance.
“We need to encourage and mop up individual lability. Another thing is that we have not been able to communicate the benefits of insurance to the public. Why should we be raising money for relations when a member of the family dies? That would have been done through insurance. We must begin to tell people about insurance. That would be the game changer,” he said.