Highlighting NAICOM’s 2021 – 2023 Strategic Plan, Goals and Objectives

Some members  of the NAICOM Management team at the seminar

National Insurance Commission (NAICOM) has unveiled its Corporate Strategic Plan that will provide direction for the Commission’s corporate activities in the next three years. In this article, EDET UDOH highlights the contents of the Plan.

The Governing Board of the National Insurance Commission (NAICOM) had on Friday, April 9, 2021, approved the commission’s 2021 – 2023 corporate strategic plan. The approval became necessary as NAICOM’s corporate strategic plan 2016 –2020 ended because an entity without plans is like a car without a driver.

The objectives of NAICOM’s corporate Strategic Plan among other thing include translating the Commission’s Vision, Mission and Values into actionable and measurable goals, objectives, initiatives and activities.

The plan will also provide direction for both long- and short-term decision-making by the Board for implementation by Senior Management in order to fulfil the mission of the organization as well as enable them to make strategic efforts in ensuring adequate protection of the policyholders, beneficiaries and third parties to insurance contracts and also deepen insurance market penetration.

The Strategic Plan is subject to periodic review and performance monitoring within its life span by NAICOM Board.

The Strategic Plan is rested on five pillars namely: Ensuring that public interest and policyholders are adequately protected, Entrenching effective and efficient deliverables, ensuring a safe and sound Insurance sector, Improving Trust and Encouraging innovation and promoting Insurance market development.

The Commission, in a bid to intimate the general public on its plans and activities in the next three years, had during the 2021 Seminar for Insurance Journalists in Lagos, highlighted the components and workings of the Corporate Strategic Plan.

In his presentation at the just concluded two days annual seminar organized by the Commission for Insurance and Pension Journalists held at the Oriental Hotel, Victoria Island, Lagos, titled “Corporate Strategy of the Commission 2021-2023: Goals, Objectives and Deliverables,” Head, Strategy and Special Duties, Mr Usman Jankara, gave an insight of the plan.

He stated that the strategic plan is hinged on five goals which include ensuring that public interest and policyholders are adequately protected, Entrench effective and efficient deliverables, ensuring a safe and sound Insurance sector, Improve Trust and Encouraging innovation and promote Insurance market development.

On Improving Trust and Confidence in the Nigerian insurance sector, he noted market conduct failures, ineffective complaints and grievance management, challenges with distressed insurers, and unethical practices and money laundering are all negatively impacted trust in the industry.

He, however, assured that the commission is set to institute good market conduct in the Nigerian insurance industry and ensuring a fair complaint/grievance management system.

On Facilitating Fight against Money Laundering and Terrorism Financing, he advocated for effective management of troubled institutions and improved utilization of the Security & Insurance Development Fund (SIDF).

Jankara opined that lack of understanding and awareness, fake insurance, poor market conduct and claims practices, insolvency and cumbersome liquidation processes to mention but a few expose policyholders to unsavoury experiences with insurers and assured the policyholders and the public for adequate protection.

He said the Commission is promoting improvement in a policyholders protection scheme and better utilization of the Security & Insurance Development Fund to enhance policyholders’ protection against insolvent/distressed insures.

“Enhancing enforcement of market conduct rules and monitoring degree of customers’ satisfaction, ensuring that government assets and liabilities are adequately insured are captured in the plan,” he said

On Encouraging innovation and promote Insurance market development, Jankara said that a high rate of innovative technology adoption will impact the future of the insurance industry, adding that rate based competition drive premiums down to the extent that the risk of unfulfilled contractual obligation becomes reality.

However, he said, the commission is facilitating innovative and competitive practices in the industry through the regulatory sandbox, service-based competition, facilitating the attainment of the National Financial Inclusion target and access to insurance through alternative distribution channels, and implementing Principles for Sustainable Insurance and facilitating regional integration of West African insurance market.

He said the implementation matrix has been developed and approved, and the Corporate Strategy and Special Duties Department empowered to monitor and evaluate the progress of the plan and will periodically appraise the progress made by Departments and Units in the course of implementing the plan.

“The indices for measuring success already included under each of the Strategic Goals will provide the basis for monitoring progress and to ensuring that we are on track to successfully implement the plan,” he said.

The corporate plan, according to him, is targeted at producing safe, stable and strong insurance firms capable of competing with those of the world as well as ensuring that insurance firms are capitalised, effectively managed and properly regulated.

As part of the plan is the commencement of the Risk-Based Supervision (RBS) policy, which NAICOM has announced in August this year for the take-off of the policy in the Nigerian insurance market.

The Commissioner for insurance and the Chief Executive Officer, National Insurance Commission (NAICOM), Mr Olorundare Sunday Thomas, gave the hint while speaking at the seminar organized by the Commission for Journalists in Lagos.

He said the relevant persons have been trained, the necessary skills have been acquired and the instruments that will enable implementation have been developed, adding that what is left is to do the finishing touches for the take-off of the policy.

RBS is a system in which the supervising authority allocates time and resources to firms based on the level of risk inherent to their balance sheet.

The supervisor is expected to assess the systemic risk that affects the industry as a whole, and then analyse the level of risk specific to each firm. It takes a holistic approach and studies the business units within the enterprise, each of which may carry varying levels of risk.

On awareness, the Commissioner called on operators to increase their budget in the area of publicity.

“We are too far behind, not much of insurance is known. The regulator will do its best but I tell you that the operators must corporate with us for all of us to be on the same page”, he said.

Meanwhile, speaking on Thursday during the welcome dinner heralding the NAICOM’s 2021 seminar for insurance and pension journalists in Lagos, Commissioner for Insurance, Thomas told the gathering that the industry will begin to experience new reforms, strategic plans, digital and market development that will transform the insurance industry.

Thomas, who was represented by Mr Sabiu Abubakar, also said that the commission would continue to collaborate with journalists considering their role in the industry. “We will always appreciate your support in promoting the NAICOM agenda.

The National Insurance Commission (NAICOM) was established in 1997 by the National Insurance Commission Act 1997 with responsibility for ensuring the effective administration, supervision, regulation and control of insurance business in Nigeria and protection of insurance policyholders, beneficiaries and third parties to insurance contracts.

The Commission is saddled with the task of actualizing the following mandates as specified in the enabling law (NAICOM Act 1997):

To establish standards for the conduct of insurance business in Nigeria; To approve rates of insurance premiums to be paid in respect of all classes of insurance business; Ensure adequate protection of strategic Government assets and other properties; Regulate transactions between insurers and reinsurers in Nigeria and those outside Nigeria; Act as an adviser to the Federal Government on all insurance-related matters; Approves standards, conditions and warranties applicable to all classes of insurance business.

Others are to protect insurance policyholders, beneficiaries and third parties to insurance contracts; Publish for sale and distribution to the public, annual reports and statistics of the insurance industry; Liaise with and advise Federal Ministries, Extra Ministerial Departments, statutory bodies and other Government Agencies on all matters relating to insurance contained in any technical agreements to which Nigeria is a signatory; Contribute to the educational programmes of the Chartered Insurance Institute of Nigeria and West African Insurance Institute, and Carry out other such activities connected or incidental to its other functions under the Act.