As a build up support for the successful implementation of the Nigeria Insurance Market Development and Restructuring Initiatives (MDRI), the National Insurance Commission (NAICOM) has vowed to enforce compulsory insurance in the country.
The Commissioner for Insurance, Fola Daniel, who made the pledge at the flag-off of the programme in Oyo State, said that the project was a strategic mechanism that will expand the industry to generate projected income of about N6 trillion premium by 2020.
According to him, the launching of the project in the Oyo State capital south West Nigeria was an important landmark in the first phase of the project implementation strategy, which will end in December this year for the enforcement of compulsory insurance in the country in order to place the industry in a position to play its role creditably within the nation’s economy.
Daniel said that the MDRI project was the brain-child of the commission and one of the major components of compulsory insurance in Nigeria is insurance of public buildings in Nigeria.
He cited examples of several collapsed buildings in the country, leaving scores of people injured or dead without any compensation because they were not covered by an insurance policy.
The insurance policeman said that such a situation underscores the need for strict enforcement and compliance with all the insurance made compulsory by law.
He said, “it is a national shame to see people being brought out dead from collapsed buildings. All these buildings are supposed to be insured for security and I do recognise that no matter how much you pay to compensate victims, it does not compensate for life lost.”
“But, I strongly believe that one of the essence of compulsory insurance is to instil responsibility into all stakeholders that are connected with putting up public buildings including the town planning authorities, the architects, the surveyors and the landlords.”
NAICOM boss said that compulsory insurance was very important in the case of public buildings, as it would help to curtail the damaging and painful effect of several house collapse recorded in the country.
Daniel said that the commission would engage in vigorous awareness campaign of the policies for voluntary participation, but the commission may not hesitate to employ sanction as part of its enforcement strategies where necessary.
Said he, “we will ensure that underwriting firms promptly pay claims that may arise from the policy, as we would not hesitate to cancel the licences of any erring insurance firm in the process.”
Also, Mr. Yemi Soladoye, a consultant to the Commission on the project explained that apart from enforcing the provision of compulsory insurance products on underwriters, the Commission would also introduce certain initiatives that would further enhance the performance of the industry as a whole.
According to him, the MDRI project is designed to be a medium-term plan that would install the first phase of reforms in the areas of industry capacity, market efficiency and consumer protection in the country, adding that the project would be effective between last year and 2012.
Said he, “the Commission has identified that if the compulsory insurance is effectively policed with products that meet the desire of the consumers that would be to our advantage, we have studied some countries, and realised that if properly harnessed, the compulsory insurance normally generate up to 50 per cent of the total premium income in the economy.”