NAICOM Boss Decries Impact of Inflation on Insurance Industry

*Says brokers account for 70% of Nigeria’s insurance businessesNume Ekeghe

The Commissioner for Insurance and Chief Executive Officer (CEO) of the National Insurance Commission (NAICOM), Mr. Olusegun Omosehin, at the weekend decried the impact of inflation on the insurance industry.
Omosehin raised the concern at the Insurance Meet Tech (IMT) 2024 conference held in Lagos.

He described inflation as a major concern for the insurance sector, adding that rising prices affect both insurers and policyholders.
The commissioner, represented by the Head, NAICOM Lagos Control Office, Mr. Julius Odidi, noted that it would be difficult for insurance companies to operate profitably, especially if the cost of claims increases due to inflation.
“To mitigate this, insurers must carefully manage their investment portfolios, adapt pricing strategies, and maintain adequate reserves.
“It is critical to note that navigating the current macroeconomic realities successfully would be a natural precursor and building block for the revitalisation of the insurance industry,” he said.

Omosehin promised that NAICOM had prioritised prompt settlement of all genuine claims, fair treatment of policyholders and utmost transparency, as some of the ways to boost the insurance industry’s image and support economic growth.
He noted that the commission resolved to give priority to the settlement of genuine claims, as that was the fundamental reason of its existence as an industry.
The commissioner stated that insurers needed to embrace digitalisation.
According to him, insurers must modernise their processes, enhance customer experiences through digital channels, and invest in technology to streamline operations.

“Adapting to changing consumer behaviours and preferences is equally important, as offering online policy purchase, claims processing, and customer service can attract tech-savvy customers,” he said.
In a related development, Omosehin, while presenting the outcome of a courtesy visit by a delegation of the Nigerian Council of Registered Insurance Brokers (NCRIB) led by its president, Babatunde Oguntade, to the commission recently, said over 70 per cent of insurance businesses recorded annually were contributed by insurance brokers.

He said the visit underscored the pivotal place insurance brokers occupied in the nation’s insurance ecosystem.
According to him, this necessitated the commission’s intention to further strengthen and support its regulatory body so that it could effectively discharge its self-regulatory functions.
Omosehin said that the commission was ready to maximise the brokers’ vantage points and drive the desired industry growth initiatives under its new leadership.

The NAICOM boss said the insurance industry had the potential to play a catalytic role in buoying the nation’s economy.
He said the industry’s current contributions to the nation’s Gross Domestic Product must be enhanced to earn the industry its desired position within the nation’s financial ecosystem.
Omosehin said that the commission had been restructured into new directorates to meet the need for effective regulation of the ever-evolving insurance industry.
“The commission regulates professionals who operate in the private sector, and as such must adapt itself to the dynamism and dynamics of the sector for effective regulation,” he said.

Responding, the NCRIB President, Babatunde Oguntade, applauded the new leadership and management of NAICOM.