INSURERS MAY BE COMPELLED TO SUBJECT OFFSHORE SUBSIDIARIES TO NAICOM REGULATION
Insurance companies that have subsidiaries outside the shores of the country may soon be compelled to subject the subsidiaries to the regulation of the National Insurance Commission (NAICOM).
To this end, such companies may soon begin to operate a consolidated account with their foreign subsidiaries.
MR. Fola Daniel Commissioner for Insurance, who made this assertion in Akwa Ibom, noted that the action became necessary because many companies operating foreign subsidiaries are chasing shadows.
Daniel noted that many of such companies do not have insurable interest before going abroad to open offshore subsidiaries.
Meanwhile, Mr. Babajide Agbeja, managing director of Boff and Company Insurance Brokers stated that for every one insurance outfit opened outside the country, four new branches must have been opened in Nigeria.
While cautioning that necessary research must be carried out before crossing the borders and not just in a bid to toe the line of the banks, Agbeja posited that charity must start from home.
Also Mr. Val Ojumah, managing director of FBN Life Limited maintained that the concept of going abroad to open branches is not entirely a bad one; however there is need to develop the home front adequately.
In his words 'The focus should be to cover the whole of Nigeria very well as such companies should stop jumping out just to catch up with the Jones's.'
He stated that underwriters should focus on opening branches in Nigeria while not closing their eyes to opportunities adorning the West African coast or any where else in Africa, adding 'Insurers should concentrate a lot more on creating new products locally as well as expanding network within Nigeria.
Going abroad, he stressed, requires careful planning and companies should ensure that when they do it, they do it right.
Mr. Theo Eke, former Managing Director of Union Assurance Plc stated that it is not just any country that insurers can move into since some of these African countries have relatively low population with active insurance companies. He stressed that these countries though small economically are more organised than Nigeria and a single flop could impact greatly on the image of the industry and the country at large.
However, Mr. Wale Onaolapo, managing director of Sovereign Trust Insurance Plc posited that venturing out is not entirely a bad idea but that the local market still offers a lot of potentials.
Mr. Yemi Soladoye, an industry expert on his part noted that the capital base fund of insurance companies are not meant to be bank deposit or to develop Ghana market, stressing that charity begins at home.
According to him, the local market still needs to be developed in areas of capacity, efficiency and safety, explaining that capacity ensures that the sector is financially sound; efficiency entails creating a performing market structure; while safety will induce consumer trust in the market.