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Guidelines on micro insurance for service providers, NGOs, trade associations underway – Naicom

By Favour Nnabugwu

As part of its efforts to ensure insurance is known in all the nooks and crannies of the country, the National Insurance Commis-sion says it will soon roll out guidelines on micro insurance for intermediaries to sell micro insurance in the sector.

The Commissioner for Insurance, Alhaji Mohammed Kari, said this at a workshop in Gombe Penultimate Saturday .

Kari said that the products would ensure that everybody is carried along and actively participates in the financial sector in the country.

He explained that since the release of the regulations of micro insurance and takaful, companies have opted to use the window of opportunities for the products.

The guidelines, he explained, will guide the intermediaries such as service providers, Non-Governmental Organisations, trade associations that want to sell micro insurance of insurance companies.

Kari said: “But we have since got new applicants on direct dedicated takaful companies and we have already issued two takaful licences.

“We have just approved for one to commence on the final inspection before they commence their operations.

“They have submitted their product proposal and a meeting has been arranged for the technical advisory committee to look at them for the purpose of approving them.

“We believe that with the coming of the two, we will have to consider going forward; how long we should allow the windows to continue operating.

“In the last insurance committee meeting, the committee came up with proposals on developing micro insurance  but have still not accepted which one to take.”

Kari said the commission had reviewed the released guidelines in order to try and make micro insurance more micro for the people.

Kari also said: “Because the whole idea of micro insurance is to have the insured person very proximately located to the provider and you cannot have good micro insurance if the proximity is not there.

“The claims processes will be as cumbersome as the conventional and that will defeat the aim, so we are considering increasing the level of licensing, which I believe we will conclude soon.

“And we may also consider conventional windows, as indicated by companies and so on because the market has  even proposed weather we

should consider the Indian approach for micro insurance.”

He said that Indian does not issue separate licence for micro insurance, they compel every company to do a minimum of 20 per cent for micro insurance products.

The commissioner said that various proposals have been submitted regarding the approach to adopt and NAICOM would consider them and select the best that suits the Nigerian market.

Micro insurance is an insurance that is usually accessed by low income earners in the society while takaful is a non-interest insurance, which terms and conditions are in line with Sharia Practices.

The aim of the products is to ensure everybody is included so as to increase the contribution of insurance to the country’s Gross Domestic Product.

 


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