Has the Insurance Act 2003 made Nigerians poorer since
the passing of the law, especially the last five (5) years?
A credible question but one I wish to address in a
simple exploratory manner.
Did you know that the Insurance Act 2003 essentially
holds the key for meaningful insurance experiences in Nigeria and better
quality of life for Nigerians, yet WE, the people have ignorantly missed out?
You may be excused for not knowing this, but not
excused for not enquiring why? Let me explain.
A cursory review reveals that we may have been seeking
to modernise the way we do insurance and digitize the process of reaching and
serving customers, and paying very little attention to the benefits the
existing law offers. Yes, the laws are obsolete but until the amendments
arrive, we have to exercise the aspects that would deliver value to our
national economic recovery and growth agenda. How could we have missed all the
value the Insurance Act holds while fighting poverty?
First, let us appreciate the VALUE missed especially in the last 5
years:
1. In January 2016, the Dr. Omogbai-Omo Eboh led Insurance Law Review
Committee appointed by the then Finance Minister was set to undertake its
assignment and indeed successfully produced and submitted the report, which had
since reached the National Assembly. Unsurprisingly, the Consolidated
(Amendment) Bill is yet to be passed and we are waiting while missing much
value from the subsisting law. In this regard, besides the value of time,
considering that there was a previous failed effort based on the work of the
Professor Joe Irukwu Committee of 2009, the strategic value the insurance
industry could have given to the economic safety initiatives of the President
Muhammadu Buhari administration have been lost. For example, could Nigeria do a
Social Investment Programme without insurance and expect any significant
changes to the poverty index? Similarly, how would an Economic Stabilization
Committee be constituted without insurance and risk management professionals?
Will that not leave much value out of the recommendations that would be made?
2. Nigerians have suffered the pains of motor accidents, collapsed
buildings, burnt markets and recently, deaths due to COVID-19 pandemic across
the country while the Insurance Act 2003 which amendment we await, provides the
following points for poverty minimization:
Is it not value to our fight against poverty that the
law stipulates the insurance of buildings under construction considering the
associated risks? Think for a moment about the news you read or the picture you
saw of the lives lost not to mention the damages to other nearby
properties;
Markets and most buildings that have been gutted by
fire or collapsed or flooded are properly classified as public buildings, yet
when these unexpected and unfortunate incidents occur, we simply cry and make
calls for relief assistance from government that already put the law in place,
which has been ignored. Why?
Why would these aspects of the Act that stipulates
value in the manner of protection of our lives and punishment for defaulters
who cause us pain and anguish wait?
Section 70 subsection 2 declares that "Any insurer who contravenes
this section commits an offence and on conviction is liable to a fine of
N500,000."
Is it not true that the responsibility to deliver these values clearly
rest with the regulator, National Insurance Commission (NAICOM), who by
implication, may have inadvertently been denying Nigerians the
opportunity of enjoying these values especially saving us the pains and anguish
after every disaster?
Indeed, the impact reflects on the poverty index when claimants are left financially weakened while waiting for months and years for payments of their claims beyond "90 days after the issuance of discharge voucher".
The Waiting Continues, Value Erodes
As Nigerians are made to wait for the Insurance Consolidated (Amendment)
Bill to be passed by the National Assembly; wait for the recapitalization of
insurance companies to be concluded; wait for insurance companies that are
owing claims to pay up and wait for products that suit the needs and lifestyle
of young Nigerians and generally, wait for a better insurance experience,
Nigerians who have been stretched by the effects of COVID-19 pandemic are more
likely to become poorer.
In other words, by the time the Insurance Consolidated (Amendment) Bill
is ready, Nigerians might either have adjusted to life without insurance
or become seriously unable to pay for insurance no matter the price.
More than at any other time, many Nigerians have learnt their lessons
and some have seen the value in putting something aside through insurance but
only a few players in the insurance sub-sector are ready for the
engagement.
How long will these waits be? No answers can be seen across the clime.
Be Advised
I dare to advise these respective groups of Nigerians thus:
Group One which comprises those that desire to
buy insurance now; please be advised to engage your insurance agent/broker in
what I call "When Claims Happen Meeting" before you commit to the
contract. Yes, contract! Some people have failed to see insurance as a contract
and often treat it lightly, isn't it?
Group Two which comprises those individuals whose
Life policies have matured and they have been waiting for their Surrender
Value; please consider taking all available legal steps especially by sending
Reminder Letters to NAICOM one last time. As you may be aware, the newly
appointed Commissioner for Insurance has expressed commitment to address
policyholders' issues.
Group Three which comprises those micro and small
business owners who survive daily risks to eke a living; please identify a
credible insurance broker/agent that will patiently engage with you to
understand your risk challenges and work with you to get a suitable insurance
coverage that will ensure you can access credit and safeguard yourself and your
business into the future. Some of your peers have relied on insurance to
recover from accidents and incidents but may not tell you.
Generally, we hope that conscious efforts will be made by all insurance
stakeholders to improve the quality of lives of Nigerians during the waiting
period highlighted here.
Nigerians deserve better especially as COVID-19 pants, and thanks to
those few bold insurance companies that have shown empathy at this time.
About The Author
Ekerete Olawoye Gam-Ikon, MNIM,
CPP, is a management consultant with a specialization in Strategy and
Insurance. He is available through e-mail olagamola@gmail.com
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