Why CISWAMZ Was Established – WAISA Chairman …CISWAMZ Assures Members Of Development Of RBS Framework
Mr. Olorundare Sunday Thomas, WAiSA Chairman/NAICOM CEO
The Nigerian Commission for Insurance/Chief Executive Officer, National Insurance Commission (NAICOM) and Chairman of West African Insurance Supervisors Association (WAISA), Mr. Olorundare Sunday Thomas, has highlighted the rationale behind the establishment of the College of Insurance Supervisors for West African Monetary Zone (CISWAMZ).
The Chairman, College of Insurance Supervisors for West African Monetary Zone (CISWAMZ), Mr. Pius Agboola has also assured of CISWAMZ readiness to assist the West African countries in the development of their Risk-Based Supervision Framework.
Speaking at the second meeting of CISWAMZ at Reiz International Hotel, Abuja, Thomas said the establishment of CISWAMZ was an important milestone in the integration of the Insurance Sector under the ECOWAS Monetary Cooperation Programme.
Thomas said the establishment CISWAMZ was based on the recognition of member states that co-ordination of supervisory effort and sharing of information of supervised entities is important in carrying out an efficient consolidated supervision, maintaining effective oversight, promoting compliance with extant laws and maintaining the highest level of oversight quality while carrying out their supervisory responsibilities in their respective Countries.
He urged the College to develop a process of documentation that gives priority to how proceedings are documented, noting that ‘this will be a reference point for improved supervisory activities in the region.”
According to him, “Giving that the world is becoming a global village with the development of information technology and the inter global dynamic of business/organisation’s risks, the need for regional co-operation cannot be overemphasised.”
The International Association of Insurance Supervisors (IAIS), Thomas said, has provided a forum for members to share their experiences and understanding of Insurance supervisory and insurance markets.
He said their experiences and practices led to the development of 26 Insurance Core Principles (ICP) and two of the principles centred on regional and international cooperation.
“The ICP 25 is on Supervisory Co-operation and Co-ordination (Sectorial, Regional and inter- regional) while ICP 26 is on Cross Border Cooperation and co-ordination on Crisis Management,” WAISA Chairman explained.
Thomas hinted that the Financial Action Task Force (FATF) created in 1939 is an inter-governmental body whose purpose is to develop and promote National and International policies to combat Money Laundering and Terrorist Finance.
He said “The anti-money laundering body has developed 40 Recommendations and 11 Effective Outcomes and there is no country that can achieve any reasonable progress in its effectiveness without actively belonging /or Co-operating with other Countries / regional bodies in the implementation of their policies. Therefore, what the region has done is a good step in the right direction to forge synergy between/among us for the goal of effective and efficient regulation and Supervision of Insurance institutions in our region.”
The Chairman CISWAMZ in his remarks at the occasion assured West African Countries of CISWAMZ readiness to assist them in developing their Risk-Based Supervision (RBS) framework, RBS manual as well as ensure adequate knowledge sharing.
Agboola, who is also NAICOM’s Director, Inspectorate Directorate, stressed that Nigeria would be glad to share the RBS Framework for Insurers and Reinsurers in Nigeria with member states.
He said the hosting of the Regional RBS by NAICOM and Toronto Centre, Canada in February 2022 has enriched the commission’s understanding of Risk-Based Supervision and Risk-Based Capital.
While pointing out that the insurance business is not done in isolation,
he said the entrepreneur who establishes an Insurance Company might choose to serve only the local markets or the company may expand and go beyond the shores of the jurisdictions.
He listed the factors to include; risk diversification, declining opportunities in the home jurisdiction, and the need for consolidations.
Other factors, according to him, include; the need to follow their clients abroad which is common in the oil and gas sector, expected benefits and available unutilised potentials, among others.
He added that “The special nature of Insurance and the fact that it is a business in the financial sector entails that it is highly regulated in the jurisdiction of operation. As the business expands beyond the jurisdiction of establishment or operation, the need for bi-regional or multi-regional co-operation and/or understanding grew. “Hence, the need for this regional integration called College of Insurance Supervisors of the West African Monetary Zone. The College is also established to Complement and implement the ideas, Projects and directives of the parent body – WAISA.”
