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Insurers need more retail agents – NAICOM

By Patience Saghana

The insurance industry needs more retail agents to effectively enforce compliance to the compulsory insurnace products and achieve bout 80 per cent insurance culture in the country.Consultant to National Insurance Commission (NAICOM), Mr. Yemi Soladoye said  in Lagos the number of insurance agents in the industry at present is inadequate and there is need for significant  increase in the number of agents operating in the sector. Addressing  middle managers in insurance companies at a recent workshop, he  said the commission is determined to enforce all the necessary provisions in the Insurance Act, 2003 particularly with regard to the compulsory insurances under the Act. The renewed enforcement drive is to ensure that the industry achieves its set targets with regard to premium income and contribution to Gross Domestic Product (GDP) of the country.

Part of strategies for achieving this, according to him is the creation of a robust and strong agency arm in the industry, adding that a situation where insurance brokers control about 80 per cent of the insurance business in the country is not  acceptable . He said  that insurance brokers handle wholesale insurances and are not in a position to reach out to individuals in all the nooks and crannies of the country, adding that it is only insurance agents marketing retail insurance product that are capable of reaching Nigerians wherever they are residing. He said that it was wrong for any practicising insurance professional in the underwriting arm to collect agency commission when the person is not a legitimate agent. “It is either you continue as an employee of an insurance company doing your job and drawing your salary from the company or you resign and register with NAICOM as an Insurance Agent”, he clarified.

He also listed some of the people who have for long been collecting commissions from insurance businesses illegally to include commercial and mortgage banks, leasing companies, cooperative societies, automobile sellers, risks associations, unregistered insurance agents and brokers, etc warning that the era when such people collect a cut from insurance business is gone for good. “Some of the areas of illegalities that practitioners have encouraged before now must stop.  NAICOM will no longer accept staff agents in the industry; a situation where employees of insurance companies demand for and are being paid commission on insurance business they brought to their companies will not be allowed.

“Some banks having insurance subsidiaries collect commissions  on businesses they direct to their subsidiaries and some even give a percentage of the leads who introduce other insurance customers to them. Some motor companies as well insist on collecting commission on the insurance of their credit customers to the extent that some even demand for something higher than the statutory agency commission.


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