Insurance brokers in Nigeria, may have seen light at the end of the tunnel in their quest to be issued with life operating licenses as the regulator, the National Insurance Commission (NAICOM), has promised to abolish the regime of annual brokers’ licence renewing regime to replace it with longer life span licensing regime.
The brokers have been pushing to be put on the same pedestal with insurance underwriters in the area of life insurance licence issue.
But the NAICOM had turned down their request and insisted that the brokers must annually renew their operating licences .
But at the just concluded National Insurance Conference held in Abuja, NAICOM, said the brokers’ annual licence renewal process is becoming cumbersome to the commission itself thus it has resolved to expand the process to a longer period.
NAICOM said the brokers’ annual operating license renewal, when abolished, would be replaced with longer life span licence regime if it cannot grant the life licensing for now.
The Deputy Commissioner for Insurance Technical, Sunday Thomas, who disclosed this at an interactive session between the operators and regulators of insurance sector, said the issue of perusing through the brokers documents during the annual renewal of their operating licenses â€œis becoming too boring and burdensome to the commission.â€
He said to reduce the work load for the commission in this regard, it was considering the brokersâ€™ complaints on the cumbersomeness of the exercise and has resolved to give them a longer span licence.
He said: â€œIn brokers’ licensing, NAICOM is ready to make changes where necessary. Life licensing for brokers may not be possible for now but there are challenges in annual license renewal for brokers. Therefore since the burden of carrying out the task of annual renewal is glaring, we can consider licensing system that has longer life span”.
Thomas also said the regulator has resolved to take up the task of deepening g insurance penetration in the country.
“There has been issue of penetration of the market. The regulator, has demonstrated what it thinks is good for the market by looking at recapitalisation of the market and also came up with what it thinks will fast track buying and patronage of insurance products. We have had micro insurance scheme all these while but it appears operators are not as enthusiastic as the regulator, so now we have allowed people to come up from outside and we have created four different categories of licenses ,the unit operators, the regional operators, the state operators and national operators. This is to fast tract the process of reaching out to Nigerians and we have been receiving enquiries,” he stated.
He also said the commission is working on the alternative distribution channels, adding, while 80per cent of insurance business is done through brokers in the area of corporate business which is where the bulk of premium of the industry comes from, micro and retail insurance would be driven by theater alternative distribution channels.