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Chiamaka Ajeamo
The National Insurance Commission (NAICOM) has said that it would in 2020 begin the implementation of new regime for renewal of insurance brokers licence.
The Acting Commissioner for Insurance, Sunday Thomas, who said this at the Chartered Insurance Institute of Nigeria (CIIN) 2019 insurance professionals’ forum, held recently in Abeokuta Ogun State, stated that the initiative would strengthen the broking business.
Thomas stated that brokers are very relevant in the insurance business value chain, thus, the need to reposition the sector.
In this new licence renewal regime, NAICOM had proposed N5 million and N3 million licensing fees for insurance broking business as against the present fee of N2.5 million.
The insurance regulator in a draft guideline for the regulation of insurance brokers in Nigeria, issued in June 2018 to all insurance broking companies, stated that in the proposed regime, brokers would operate 2-tier mode – Corporate and Partnership.
NAICOM noted that investors seeking corporate licence have to pay non-refundable application fee of N500,000 and those for Partnership license N300,000, adding that every insurance broker shall upon successful conclusion of the registration process but prior to issuance of a license, pay a licensing fee of N4.5 million for Corporate and N2.7 million, which together with the application fee amounts to N5 million and N3 million respectively.
The Commission maintained that every insurance broker shall pay bi-annual license renewal fees of N1 million for corporate and N600,000 for partnership, adding that Corporate brokers would maintain a professional indemnity cover of not less than N10 million, which is N100 million in the case of oil and gas insurance brokerage or 50 per centum of its annual brokerage income for the preceding year, whichever is the greater, whilst partnership operators will a professional indemnity cover of not less than N5 million, which is N50 million in case of oil and gas insurance brokerage or 50 per centum of its annual brokerage income for the preceding year, whichever is the greater.
Meanwhile, the Commission, also disclosed that it will deploy digital regulatory portal by the first quarter (Q1) of 2020.
According to NAICOM portal will integrate all insurance transactions into a single hub will come 2020.
Thomas, while charging insurance firms to embrace new trends in technology, added that the commission on its part is committed to improving the use of technology in the sector.
“It is on this premise that the Commission is investing hugely in automating most of its operations. To this end, the Commission’s portal that will integrate all insurance transactions into a single hub will soon go live. The implication of this will be a transformation of businesses to online.
“Hopefully, by the time we meet next year, our processes would have become fully automated and operational. Suffice it to say that NAICOM has at all times encouraged practitioners to imbibe the adoption of technology in their businesses,” he said.
