NAICOM May Replicate Malaysia’s Takaful Insurance Model In Nigeria
The Nigerian Insurance Industry Regulator, National Insurance Commission (NAICOM), has indicated interest to understudy the Malaysian Takaful Insurance model for possible adoption In Nigeria to deepen the country’s Takaful Insurance Market.
The Commission also emphasized the need for knowledge sharing between Nigeria and Malaysia in critical business and investment areas.
Speaking during the courtesy visit by the Malaysian High Commissioner to Nigeria, Mr. Aiyub Omar, to NAICOM Headquarters in Abuja yesterday, the Commissioner for insurance/Chief Executive Officer of NAICOM, Mr Olusegun Ayo Omosehin, commended Malaysian government’s exploit in Takaful Insurance in the past three decades.
Omosehin who sought to unlock the secrets of Malaysia’s success in Takaful insurance development, called for collaboration with Mr. Aiyub Omar, the Malaysian High Commissioner.
The collaboration was accepted in two key areas: capacity building and investment opportunities.
To achieve insurance growth in Nigeria, the Commissioner for insurance suggested the need to studying countries with similar characteristics with Nigeria, such as Malaysia, which he said, has witnessed rapid growth in Takaful Insurance over the past three decades.
This approach, Omosehin stated, would enable the Commission to identify best practices, gain valuable insights, and adapt strategies that have proven success in similar markets.
“By exploring international models and benchmarking the model of industry leaders, the Commission aims to create a more conducive environment for insurance growth in Nigeria, ultimately benefiting policyholders and stakeholders alike,” NAICOM boss added.
The Commissioner further stressed the importance of knowledge sharing to replicate successful models in Nigeria, particularly in achieving President Bola Tinubu’s vision of a $1 trillion economy, noting that the goal, aimed to be accomplished within eight years, relies heavily on collaborations with foreign governments, including Malaysia.
On the industry’s potential even in the face of low penetration, he said “Given Nigeria’s low insurance penetration, the potential for growth and investment is substantial. Notably, the country has made progress in the Takaful insurance sector, expanding from a single company in 2013 to six companies currently under the National Insurance Commission’s regulation.”
To tap into this potential, the Mr. Omosehin emphasized the need for knowledge sharing and strategic partnerships, noting that “By learning from Malaysia’s experiences and best practices, Nigeria can accelerate its economic growth and development, ultimately achieving the ambitious goal of a $1 trillion economy.”
The NAICOM boss brought to the Malaysian High Commissioner’s attention the newly passed insurance bill by the Senate, which now awaits concurrence from the House of Representatives.
The, according to Omosehin, “is expected to significantly boost capital in the insurance industry and create new investment opportunities.
“By enhancing the regulatory framework, the bill seeks to promote the growth and development of the insurance industry in Nigeria, ultimately contributing to the country’s economic growth.”
The Malaysian High Commissioner, in response, said he was thrilled by the reception given to him by the NAICOM ,and expressed his enthusiasm for collaboration.
He highlighted Malaysia’s expertise in Takaful Insurance, emphasizing the potential for bilateral agreements to drive growth in Nigeria’s insurance industry, particularly in the Takaful sector.
Noting NAICOM’s strong interest in developing the industry, the High Commissioner pledged to facilitate connections between Malaysian Takaful insurance companies and Nigerian stakeholders, paving the way for further investment and cooperation.
This partnership could leverage Malaysia’s experience in Takaful insurance, which has been a significant contributor to the country’s Islamic finance sector.
The Malaysian High Commissioner expressed interest in capacity building for NAICOM staff, proposing a training programme to be led by Malaysian resource personnel.
The programme, he said, will aim to enhance the skills and knowledge of NAICOM staff as regulators, ultimately adding value to the Nigerian insurance industry.
This initiative aligns with NAICOM’s goals, which include strengthening supervisory capabilities, improving safety and soundness, and fostering innovation and sustainability in the Nigerian insurance industry.
By collaborating with Malaysian experts, NAICOM can leverage international best practices to achieve these objectives.
In conclusion, Mr. Omosehin, described Malaysia’s Takaful Insurance Industry as phenomenal.
Present in the meeting was the Deputy Commissioner Technical, Mr. Usman Jankara; Deputy Commissioner Finance and Administration, Mr. Ekerete Ola Gam-Ikon; the Director, Legal and Enforcement & Market Development, Dr. Talmis Usman and others.
