From Ngozi Onyeakusi, Lagos
Following micro insurance revived guidelines recently released by the National Insurance Commission (NAICOM), investors from all works of lives have been trooping into the commission applying for operational license.
Confirming this, the Head Corporate Affairs, NAICOM, Rasaaq Salami, stated that the commission had received applications from investors seeking state and unit micro insurance licenses.
According to Salami, the commission prior to the release of the guideline have been receiving some applications but insisted that the guideline should be released before considering any application.
NAICOM assured it was committed to properly examining the applications to ensure that fit and proper investors are granted approval to operate the business which is aimed at taking insurance to the grassroots.
Recall that NAICOM released a revised micro insurance guideline which provides that a National Insurer, who seek composite micro insurance licence, is expected to be capitalised to the tune of N600 million, while N400 million minimum capital base is needed from a General micro insurance and N200 million for a Life operations.
Such national operators is expected to have presence in at least six states within the three geopolitical zones of the federation.
For a State Microinsurer, the minimum capital base is NI00 million, broken into N60 million for general and N40 million for life operators. The regulator also expects such underwriter to operate only in one State of federation with at least three branches or office locations, each in a different Local Government Area.
A Unit Microinsurer investor, the commission provided must be capitalised to the tune of N40 million, N25 for general business and N15 million for life, with operation in one location within a local community.
The rationale behind the revived microinsurance guidelines, the commission said, was to ensure that all Nigerians are fully covered and understand the importance of insurance in economic development.
The regulator, has therefore made it mandatory for these micro insurance outfits to make themselves visible especially at the grassroots.
According to the Commissioner for Insurance, Mohammed Kari, while commenting on the revived guideline said, NAICOM has the needed capacity to supervise these firms coming up, as there are plans by the commission to float more branches and recruit new staff across the country to have a closer monitoring of not only these microinsurance outfits, but also the conventional insurance companies.
Microinsurance products are designed for the low income market, low valued policies, micro and small scale enterprises in relation to cost, terms, coverage, and delivery mechanism. He pointed out that the regulatory body is already receiving application from investors
The new move, is focused at increasing insurance penetration from 0.6 per cent it is presently to over two per cent in the near future, as well as increase the annual premium income of insurance industry to N1 trillion by year 2020.