NAICOM Warns Insurers Against Delays In Settlement of Genuine Claims
The Commissioner for Insurance/Chief Executive Officer, National Insurance Commission (NAICOM), Mr. Olusegun Ayo Omosehin, has warned insurance operators against unnecessary delays in the settlement of genuine claims, saying such act will no longer be tolerated.
Speaking at the 2024 Insurance Directors’ Conference in Lagos recently with the theme “Board Performance in the Nigerian Insurance Industry: A GRC Approach” NAICOM CEO emphasized the importance of addressing certain critical areas that are pivotal to the insurance sector’s expansion and safeguarding policyholders’ interests.
While highlighting the steps taken by the Commission to ensure prompt claim settlement, he called on all insurers to significantly reduce their outstanding claims by the end of this year.
He stated that the Commission is committed to enforcing the law and taking action against any insurer failing to meet their claim obligations even as he underscored the importance of financial stability and soundness of insurance institutions.
“The Commission’s primary focus is ensuring timely payment of genuine claims (payment of claims and timely too). We expect all insurers to significantly reduce their outstanding claims by the end of the year, as emphasized during the last Insurers Committee meeting. Unnecessary delays in the settlement of genuine claims will no longer be tolerated.
“As a Commission, we are committed to strictly enforcing the law and taking swift action against any insurer failing to meet their claim obligations. Simply put, if a company cannot honour legitimate claims, it has no place in our industry.
“The financial stability and soundness of our institutions are now more vital than ever. To remain relevant and competitive, our institutions must comply with all the relevant prudential regulations and requirements. We must begin to prepare our various entities well ahead of the Risk-Based Capital regime, so that ensuring adequate capitalization is no longer optional. We must prioritize robust capitalization to effectively tap into target markets and navigate current industry realities.”
On what the Commission has done in the last 18 months on Risk Based Supervision, he said: “The Commission, in the last one and half years, has successfully examined a few of our institutions using the Risk Based Supervision Approach, even though the exercise has not been fully completed. However, we are using this medium to seek your cooperation as Directors of those institutions and demand compliance on issues that have been raised and directed to the various Boards, for attention.
He urged all directors as policymakers across insurance institutions to develop and implement policies that promote adherence to good governance, effective risk management and compliance principles.
While noting that the Commission’s goal is to ensure sustainability, securing the long-term viability and future resilience of insurance entities, he added: “We all have a stake in the prosperity of our institutions since the insurance sector’s growth is essential to the overall health and resilience of our national economy.”
