NAICOM to Use Stockbrokers As Referral Agents

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Ebere Nwoji

The National Insurance Commission (NAICOM) is to use stockbrokers as part of the referral agents in the insurance distribution channels it has proposed to set up.

The commission disclosed this during a recent visit to the Director- General Security and Exchange Commission( SEC), Mr. Munir Gwarzo in Abuja.

The commission said this is part of its on-going effort to deepen insurance penetration in the country.
NAICOM Deputy Director Authorsation and Policy Mr. Leonard Akah, who led the NAICOM delegation, outlined the role of stockbrokers in the sale of insurance product as being limited to referral partners/agents to the insurance companies without being exposed to any risk.

In return, he said the stockbrokers will earn a percentage commission on any business they are able to generate to the insurance company.

According to him, this initiative is expected to create opportunities for the stockbrokers that are interested without distracting them from carrying out their core functions.
He added that draft guidelines to ensure seamless operation of the initiative will be sent to SEC for input before the final exposure.

In his response, the SEC DG represented by Head, Monitoring Department, Mr. Isyaku Bala Tilde, thanked NAICOM for the initiative and promised to collaborate with the commission to ensure its smooth execution.
In the bid to deepen insurance penetration, NAICOM has identified various other professionals for consideration in the referral agency model. These include accountants, lawyers and a host of others.

NAICOM, had a fortnight ago announced that it has created new distribution agencies tagged “Referral Partners/Agents” for distribution of insurance products in the country.

According to the commission, the channel will entail integrating and involving many organisations to be partners/agents of insurance companies in the distribution of insurance products across the country.

“To this end, the commission has created new distribution agencies to be known as “Referral Partners/Agents.” These channels will entail integrating and involving many organisations to be partners/agents of insurance companies in the distribution of insurance products across the country”, said the commission
In a statement made available to THSDAY, the Commission had said that the initiative is expected to create opportunities for individuals and regulated corporate entities to play a vital role in the insurance distribution chain to access and reach the largely underserved majority of the Nigerian population without being exposed to any liability.

The commission had also promised to meet with relevant regulatory agencies and professional bodies to discuss the modus operandi and benefits inherent in the new initiative.