Commissioner for Insurance, Mr. Fola Daniel
The National Insurance Commission (NAICOM) has said that it would like to submerge commercial agricultural risks underwriting business in the country under micro-insurance to ensure that farmers at the grass roots benefit from such financial protection plan.
The Commissioner for Insurance, Mr. Fola Daniel, who dropped this hint also encouraged interested operators to apply for approvals to venture into agricultural insurance, maintaining that there is no monopoly in agricultural insurance.
Speaking on agricultural insurance business in the country, the commissioner said that no operator has monopoly over the business contrary to the opinion that the Federal Government-owned, Nigerian Agricultural Insurance Corporation (NAIC) has monopoly over it.
“For agricultural insurance, people talk about monopoly by NAIC, but there is no monopoly, we have demonstrated this by asking people to submit products for approval, IGI did and we have approved it and if 20 more companies apply tomorrow to do any form of agricultural insurance, we will look at the policy form and the conditions, if it is okay, we will approve it.
“We actually want agricultural insurance to be more expansive and embedded in micro-insurance because our rural communities need one form of insurance or the other. Really, what we are looking at is to propagate micro-insurance give licences to small operators,” the commissioner said.
According to him, agricultural insurance is encapsulated in the Market Development and Restructuring Initiative (MDRI) introduced by NAICOM two years ago.
He said the programme has been subdivided into micro-insurance, takaful and agricultural insurance. He said, “If you look at the MDRI document, there is micro-insurance element, there is takaful and there is agricultural insurance. So we are taking takaful insurance and micro-insurance head long’’.
Speaking on the planned introduction of takaful insurance in the country, Daniel said the programme would best fit people in rural communities, expressing optimism that the new initiative would help to deepen insurance penetration in the country.
“We are bringing takaful as a product for the grass roots. The villagers are used to contributing money, and at the end of a period, they get something back. It is not really alien, so if you put money together, and at the end of the day, you either have losses or gains and you share the money, people will be happy.
“I also think that this is the quickest way and the best we can do to
reduce insurance gap in our domain,” the commissioner said.
Before now, NAICOM said takaful insurance, a platform for the protection of lives and properties based on risk sharing as against risk transfer would be available to Nigerians who are interested in non-profit risk protection services soon, promising that guidelines on takaful would be released by the commission before the end of the third quarter of this year.
The commission explained that the guidelines would make it possible for interested insurance companies to offer profit-free insurance services to policyholders across the country.
“By July, our guidelines for takaful will be ready. So anytime from August and September, we should have a platform to do takaful, we will be in a position to issue licence to people to do takaful insurance not as a window.
“So before end of September, we should be in a position to issue out licences for takaful. So we are ready,” Daniel assured.
“It is not about religion really. It is about a way of sharing risks and not transferring risks. Takaful is a kind of community risk sharing, it is fantastic, people will take it. It does not matter whether they are Christians or Moslems,” the commissioner added.