‘Market conduct guideline’ targets consumer confidence

A new consumer protection policy that would enhance consumer rights in insurance contract and consequently boost their confidence in taking up covers would soon be released by the National Insurance Commission (NAICOM), BusinessDay reveals.

The policy which would be called ‘Market Conduct Guideline’ would provide the potential insured the opportunity to understand details of the insurance  contract, rights and privileges, entry and exit rules, such that no part of the contract would be a alien to the insured in the event of loss occurring.

Consequently, it will compel companies to establish within their system dispute resolution units, to fast track enquiries and provide information to consumers.

This has become necessary to build consumer confidence on the insurance industry as part of efforts to deepen penetration in Africa’s most populace black nation where insurance penetration has been abysmally too low at less than 1 percent, despite the country’s population put at 170 million.

Fola Daniel, commissioner for insurance, said the first responsibility of NAICOM is to protect the consumer in the insurance contract. “We have renewed our vigour to enforce market discipline with stricter regulations and sanctions because we must protect the insured,” Daniel added.

According to him, the regulatory body had been taken for granted in the past because it adopted moral suasion to correct anomalies even though the law was there, stating that the new decision to enforce the law with respect to market discipline will be taken very seriously.

A senior officer in the Commission who spoke to BusinessDay on conditions of anonymity, said the guideline which would be released soon has a provision called ‘cooling period’, being a time frame of two weeks during which a consumer has the right to withdraw from an insurance contract even when premium has been paid, without losing a dime.

This cooling period helps the customer to make up his mind whether to continue with the contract or not without losing the money he or she has paid to the insurance company.

Besides that, it will enable clear and in simple terms a presentation of policy document such that the customer does not need to stress him or herself understanding the terms of the contract.

The source further disclosed that another important aspect of the guideline is that it would let consumers know when a policy can attract surrender value, so that right from the beginning of the contract the consumer is well in the know about what he or she is going into.

Modestus  Anaesoronye