Stakeholders in the insurance industry have called on the federal government to reconsider its directive to the National Insurance Commission (NAICOM) to remit 50 per cent of its internally generated revenue (IGR) to the federation account.
Recall that a policy of compulsory 50 per cent deduction from the IGR of all government enterprises was introduced by the government as part of efforts to increase revenue and plug leakages in revenue collection.
Speaking on the development, the President of the Council, of the Nigerian Council of Registered Insurance Brokers (NCRIB), Babatunde Oguntade, said the insurance supervisory fund levy being paid by insurance institutions is meant for the regulatory supervision and market development drive.
Oguntade said: “Placing the insurance supervisory fund levy within the single treasury account system would hold back the financial solvency position of the commission and ostensibly hinder the market’s much-desired insurance growth in the country.”
The NCRIB President noted that the insurance industry, which should be the linchpin of the economic revival efforts of the government in Nigeria, was currently fragile.
He also called on lawmakers to work expeditiously on the passage of the 2022 Consolidated Insurance Bill, which when passed into law, would cure the various inadequacies in the existing Insurance Act 2003 and the 1997 NAICOM Act, for the steady growth of the industry.”
Oguntade expressed concerns that government institutions were lax in ensuring that the human and material assets of the government were adequately insured.
He called on the lawmakers to reverse the tide by encouraging performance of the implementation of insurance budgets by Ministries, Departments, and Agencies for the overall growth of the insurance and its accelerated contribution to the nation’s Gross Domestic Product.”
Also speaking, an insurance practitioner and Lead Director of Transparency Protection Limited. Dr. Sam Chukwuka Onyeka, warned that the insurance sector growth will be highly affected if the government refuses to reconsider the commission as a revenue-generating entity.
Onyeka said the government should consider exempting NAICOM from the list, warning that it could seriously weaken the Commission’s financial capacity, making regulation and supervision of the insurance industry an uphill task.
“The only way to avoid this might be to increase the amount of the statutory supervisory levy. Yet, this will surely be counter-productive, as the insurers will naturally push the difference into the premiums which they charge for insurance products, thus driving insurance products beyond the reach of Nigerians,” Onyeka stated.