This year’s Insurance Professional Forum of the Chartered Insurance Institute of Nigeria (CIIN), has come and gone but the fall-out of the event remains. EDDY JOHN writes.
The forum which is a yearly gathering of insurance professionals to fraternize and interact in order to chart the growth path for the nation’s insurance industry and this year’s which took place at the ancient town of Abeoukuta, Ogun State attracted the crème de-la crème in the industry including the friends and associates of the industry.
Some of the dignitaries, who graced this year’s Insurance Professional Forum included the Governor of Ogun State, Senator Ibikunle Amosun and the Alake of Egbaland, and the Paramount Ruler of Ogun State, His Royal Highness, Oba (DR) Adedotun Aremu Gbadebo amongst others.
The theme of the Forum was “Solvency, Stability And Growth-Exploring Possibilities”. Those who spoke at the event harped on the need for the operators to embrace the issues of ethics, professionalism, best practices, stability, and solvency for the growth of the industry.
The Commissioner for Insurance, National Insurance Commission (NAICOM), Alhaji Muhammed Kari, while speaking at the event challenged the leadership of the Chartered Insurance Institute of Nigeria (CIIN) to urgently reinvent itself as a professional body and update its curriculum to either adopt or adapt contemporary best practices for the overall benefit of the profession.
He implored the new President of the institute, Mrs. Funmi Babington-Asheye, to treat the issue as priority in her agenda, while noting that when this, alongside other steps are taken, it will engender respect and credibility for the Institute and the insurance industry at large.
NAICOM boss urged the institute to ensure members uphold the ethics of the profession. “All my short professional life I have consistently harped on the issue of Ethics and Professionalism, adding that “Posterity will not judge us right if we depart this career without leaving a positive and lasting impact on what had sustained us this far.
”By a simple exercise, we can ask ourselves how many of these CIIN certified and qualified members have exhibited and sustained the spirit of the profession. How many of us conduct our business in line with the ethics, standards and principles that guide the practice of an insurance professional. The conduct of some of our professionals in the market is; to say the least; appalling and I want to urge the Institute to take a critical look at this development with a view to coming up with measures to arrest it.
“We look forward to a day when a professional will be de-certified by the Institute for unprofessional conduct. Cases are abounding around us in other professions where the privileges of a practitioner are withdrawn for some unacceptable act in his calling.
“So, I call on the Institute to review its Code of Conduct for members in order to be in tune with the current international best practice. There is obvious need to enforce discipline in the system and there cannot be a better a place to start than from the members of the Institute.
” In the spirit of self-regulation, the Commission, therefore. demands that the Institute gives an accelerated attention and incept the process of reviewing and enforcing the Code of Conduct for members, failure of which we would be left no option but to enforce it as contained the law.”
Kari expressed worried on the recent report released by Nigeria Insurers Association (NIA) that Nigeria is being deprived of billions of Naira due to “dearth of professionals in marine insurance in the country saying this has paved the way for unethical practices in this class of insurance business.
“I am glad that this is coming from the NIA, the umbrella trade Association of the Underwriters. So, my question is: what is the NIA, either as a body or individual companies doing about this dearth of professionals not only in the marine sector but across all the classes of insurance? This fact was sadly confirmed by many of our well respected Chief Executives when we ruled that all Insurance companies must recruit at least one top professional as an Executive Director, their excuse for non-compliance was that we don’t have the right professionals to be EDs.
“Given that statement we concluded that some wants to continue to be sole administrators of their companies or if that assertion was true then we have too many operational license out there. Either way there is justification for further consolidation in the industry, he said.
He called for urgent need for a reawakening to ensure our professionals are continually trained, re-trained and equipped with prevailing skills and knowledge for optimal performance in line with international best practice.
He assured that the Commission on its part would continue to support initiatives either from the institute or any of the trade Associations towards ensuring Insurance professionals are regularly updated to enable them align with current global trends. “We would work with the Institute and the College of Insurance to agree on the appropriate curriculum for such training and pass the necessary regulations to make it mandatory. Training for practitioners goes beyond attending some conference for MCPE points.
He added: “I want to task the CIIN and indeed every insurance professional to brace up to the challenge to upscale our skills in all areas to safeguard the growth of the industry.” He also urged them to join hands together to rid the industry on quacks and unprofessional activities for the overall benefit of all.
Kari stated that the commission would continue to provide the enabling and sane environment for insurance business to thrive in the country. While noting that the various reforms and initiatives of the Commission all points towards ensuring the business environment is prepared and conducive for business.
“We are leaving in a world that constantly opens new realities. We have to be bold in identifying these new realities and then embrace them and reinvent our industry. Our industry is ailing while our profession is sliding into extinction. Symptoms of the ailments can be seen all around us. This includes aging workforce, low operating capital, scattered capacity and we spend our time crossing the Ts, dotting the Is but missing the point.
“We are an industry created on the principles of partnership but has failed to imbibe the culture of partnership. We have lost our stale justification for failure to learn and progress. Our persistent self-inflicted failure has distracted investment from our industry. It has increased skepticism in our consumers and most tragically it has attracted “clever and ingenious people” into our assumed professional undertaking. In other climes these clever people would be called criminals but we have provided a convenient platform for them to excel and in turn continued to enable corners to be cut even where there is supposed to be none.
“The looming disaster as it is now is, professionals are turning into “clever people” and the professionals don’t see the danger anymore. All past attempts to reinvent ourselves have been attacked by these clever people in our midst, sadly through our professionals. Their stake in us is short term. They very much know if we plug the leaks and change, they lose, and If we fail they would only move on and we’d be the losers.
“As gloomy as it may sound, I believe we can make it better if we want. If we want we can resolve to turn around the fortunes of our industry and profession. As part of this resolve, the Commission is about to exposed the draft of the revised Code of Corporate Governance to all stakeholders. Not only have we always resisted change as an industry, we have actually fought against it, sometimes with silly arguments of being different or requiring more time to do what other sectors have achieved overnight.
He added that low insurance penetration has continued to be an issue in this market. To resolve this, we have identified the limited channels of distribution as one of the major drawback. The industry has concentrate on servicing only government and corporate clients to the detriment of the retail and micro consumers. Failure to effectively enforce the compulsory classes of insurance is another.
“In these regards we have considered and agreed to create additional distribution channels in the market to include using the services of state government to enforce compulsory insurance at the state level. We have further decided to explore and de-mystify the partnership type of operation for Brokers and I can assure you it will open a new vista in insurance inter-mediation in Nigeria and most importantly it would clearly separate the professionals from the businessmen.
He said to underscore the commission’s determination to deepen insurance penetration, it has exposed the following draft guidelines: “Web Aggregators Operational guideline, State Government’s Implementation of Compulsory Insurance (or State Financial Advisers) guideline; Independent Agents Operational guidelines; Mutual Organisations, Associations, Community Based, Micro Insurance Agencies and Non-Governmental Organisation guidelines.
The president of the institute, Mrs. Funmi Babington-Asheye, said despite the exit from recession, many businesses and individuals are still going through financial and economic crises caused largely by happenings in the local and global business environments, over which they and insurance practitioners have no control.
She, however, urged insurance companies and practitioners to explore strategies that will ensure that their entities remain solvent and are able to weather the storm, irrespective of the dynamics of the business environment. As a
According to her, as an industry that indemnifies investors and risk takers, insurance underwriters must remain stable, strong, resilient and financially solvent enough to meet emerging obligations.
She said how to achieve these goals in a sustainable way was part of the objectives of this year’s Forum.
“As businesses, we must improve our product offerings, enhance our customer service delivery efforts in order to sustain and increase their patronage. By delivering value to our clients, we would be able to make profit for our shareholders over the short to long term.
” Also, we need to minimize our cost of operations and engage in financial engineering as strategies for growing our businesses on a sustainable basis. For instance, the pool of funds which accumulate through premiums should be optimally invested in various instruments within the limits set by our regulatory framework.
“We must learn to match our capital projects/expenditure with our stream of earned profits to avoid funds mismatch, illiquidity and financial distress. This is the purpose and spirit of Section 24(1) of the Insurance Act 2003 which we are all familiar with. In summary, as we strive to create more wealth for our shareholders, solvency and financial stability should not be compromised by any underwriter in the long term interest of the Industry and Profession.
The Governor of Ogun State, Senator Ibikunle Amosun, urged insurance operators to embark on massive sensitization and develop products tailored toward needs of the public. He also called on the operators to use their operations to create wealth and collaborate with the government on infrastructural development.
He told the operators to collaborate with higher institutions to boost insurance knowledge, stressing that his administration would continue to provide conductive environment for business to thrive in the state.
The Alake and Paramount Ruler of Egbaland, His Royal Highness, Oba (DR) Adedotun Aremu Gbadebo, charged insurance operators to play according to stipulated rules, adding that insurers should not take up businesses and go about praying that claims should not come.
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