By Patience Saghana
Strong indicationsÂ Â Â emerged that the federalÂ Â Â government will further reduce the present number of insurance companies operating in the country from 49 to 15. The reduction in the number of insurers in the country, according to industry analysts would increase the capacity of the industry and also reduce the incidences of unethical business practice as a result of unhealthy competition among insurers.
VanguardÂ source at the Ministry of Finance said the federal government is considering the further reduction in the number of insurance companies in the country.
Mr Remi Babalola, Minister of State for Finance at the 31st Annual General Meeting of Africa Reinsurance Corporation in Abuja recently said the insurance laws are being reviewed so as to quicken the growth of the sector.
â€œOur laws and regulations are currently being reviewed with a view to facilitating a more effective and conducive environment for the rapid growth and development of the sectorâ€
Dr Adel Rabeh, Chairman, Egyptian Insurance Supervisory Authority who was in Nigerian on the invitation of Africa Reinsurance Corporation confirmed the fact that insurance companies (public and private sector) are 18 in number.
Rabeh also stated that plans are underway to merge regulatory authorities in the financial sector of Egypt, comprising insurance, banks and capital in order to become one strong financial regulator.
With the number of insurance companies operating in that country, Rabeh said the sector would be easy to regulate and monitor.
Insurance companies in Egypt are: MISR Insurance Company; Al Chark Insurance Company; National Insurance Company; Suez Canal Insurance Company; Mohandes Insurance Company; Delta Insurance Company; AIG Egypt Insurance Company; Arab Misr Insurance Group; Allianz Insurance Company; ACE CIIC Insurance Company; Royal & Sun Alliance Insurance Company; Egyptian Saudi Insurance Home; BUPA Egypt Insurance Company; Pharaonic American Life Insurance Company; Commercial International Life Insurance Company; Allianz Life Insurance Company; ACE Life Insurance Company and NSGB life Insurance Company
Besides, Mr. Sanusi Lamido Sanusi, Central Bank governor projected further consolidation that would reduce the current number of banks from 24 to about 15, but noted that it would not be proper to bring about such reduction by fiat.
Sanusi, however, said that â€œit will be very unwise to increase the number of banks when we should be considering strengthening and building the 23 in existence, adding it should be noted that while a good bank requires a lot of money, it must be understood that not all banks with lots of money are good while some with small money are good.
â€œWhat I think the CBN will have to do is to increase the level of co-operation between the CBN and other arms of government. And to recognise that the financial system is not an island on its own, our monetary policy has to be part of the entire economic policy and part of my role will be to tell the government what you need to be done if you want banks to lend for infrastructure.â€