….Reason for suspension of insurers’ telcos partnership
National Insurance Commission, NAICOM, has accused telecommunication companies of short-changing insurance firms in premium payments.
The Commissioner for Insurance, Mr. Mohammed Kari, who made this assertion, explained that in the mobile insurance partnership with telecom operators, the operators rake in over 80 per cent of the premium as commission while the insurers bear the burden of paying claims when liabilities occur.
Kari said this was the reason behind the Commission’s suspension of insurers’ partnership with telecom operators.
He disclosed that the regulator is presently reviewing the issue of capital adequacy in the insurance sector to ascertain the requirement for operators, noting that there will be no reckless introduction of capital requirements for insurers.
According to him, NAICOM was planning to evolve a guideline that will ensure that insurance brokers do not just hook up to a single client, but expand their operations to deepen the market.
He disclosed further that the Commission will conduct a pilot inspection on the insurance industry under its Risk-Based Supervision (RBS) initiative before the end of 2017 to test adaptation to the model and determine gaps and problems before full implementation.