NAICOM targets January to review third-party motor insurance premium

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…Expresses worry over uninsured public buildings under construction

By Asishana John

The National Insurance Commission (NAICOM), in collaboration with industry operators, is targeting January 2022 for the review of third-party insurance premiums.

This was disclosed over the weekend by the Chairman of the Nigeria Insurers Association (NIA), Committee on Publicity, Ebelechukwu Nwachukwu.

He said the committee was working on a review of the motor policy premium and the report would be submitted to NAICOM this year to publish a scientific new price for the third party that would include the ECOWAS Brown Card.

To include the Economic Community of West African States (ECOWAS), into the new plan, Nwachukwu noted that insurers met with ECOWAS representatives to examine how to process, issue and use a brown card with motor insurance in Nigeria.

During the discussion, NAICOM underlined risks that would be used to evaluate underwriting firms when it comes to visiting for risk-based supervision (RBS), such as credit risk, liquidity risk, market risk, insurance risk, operational risk, legal regulatory risk, compliance risk and strategic risk.

“NAICOM has conducted a test run of the RBS in five insurance companies,” according to Nwachukwu.

“Highlighting the risk is beneficial to the underwriters because it allows us to go back in-house and verify that our reports are standard when it comes to reporting RBS to the regulator,” the source explained.

Meanwhile, NAICOM has expressed displeasure that most of the public buildings under construction in the country are under-insured when compared to other climes.

According to the Commission, the development has further accentuated the need for urgent measures to be put in place to ensure that all of such buildings are adequately insured in line with best practices.

It, therefore, said that all hands must be on deck to reverse the trend.

NAICOM Deputy Commissioner for Insurance, Technical, Sabiu Bello Abubakar made this known at a sensitisation workshop organised for the Federal Fire Services and States Fire Services Officers on Insurance of public buildings under construction.

He said, “These ugly practices violate Section 64 of the Act that provides that all buildings under construction above two floors must be adequately insured.”

He stressed that the essence of insurance of public buildings, as well as buildings under construction above two floors, is to cushion the impact and reduce the burden, as well as liabilities that the owner/government would have to bear in the likely occurrence of catastrophic events such as natural disasters, fire, accidents, building collapse, injuries or death to third parties.

According to him, “As a follow up to the success of previous nationwide awareness campaigns for compulsory insurance, NAICOM is moving the bar a notch higher, therefore, this sensitisation workshop is aimed at equipping Fire Service Officers with the necessary knowledge to properly enforce the insurance of buildings and buildings under constructions above two floors.”