The National Insurance Commission (NAICOM), in collaboration with industry operators, on Thursday, set the September 2022 deadline for the announcement of a new premium rate for third-party motor insurance in Nigeria.
The new rate which will be an upward review of the current N5,000 premiums paid by motorists is the outcome of the discussion between the committee which consists of the Commission and chief executive officers of underwriting firms.
Third-party motor insurance is one of the compulsory classes of insurance and may be the most popular among the six compulsory insurance policies stipulated by the Insurance Act 2003.
This was made known by the Vice Chairman of its Sub-Committee, Publicity and Communication, Mr Segun omosehin at a media briefing on the outcome of the September insurers committee meeting held yesterday in Lagos.
Speaking further he said the regulator has adopted in principle the implementation of ECOWAS Brown Card and third-party motor insurance in Nigeria.
According to him what is left to be finalized is the applicable premium that will be charged and that they are working on simply because they want to be sure they consider all the pros and cons, ticking all the views and concerns with consideration before the final decision on pricing.
On the date for takeoff, he said “we are hopeful that this will be concluded on or before the ending of the month of September 2022.”
On Risk Based Supervision he said “I can announce to you that technically we have commenced Risk Based Supervision. The pilot phase has commenced with about eight companies to enable final adoption and guidelines to be released across the central market.”
Speaking on the prospects of the RBS, Commissioner for Insurance, Mr Sunday Thomas, noted that RBS has become a reality with the take-off.
He said: “The supervisor is expected to assess the systemic risk that affects the industry as a whole, and then analyse the level of risk specific to each firm. It takes a holistic approach and studies the business units within the enterprise, each of which may carry varying levels of risk.
The RBS transition process will allow NAICOM to determine capital requirements for individual insurance companies based on the risk they carry in their portfolios instead of applying the same minimum standards across the industry.
