‘All you need to know about Insurance in Nigeria’ – Series 6

Regulatory Environment of the Insurance Industry

Preamble

The Chartered Insurance Institute of Nigeria (CIIN)

The Chartered Insurance Institute of Nigeria (CIIN) is the professional body for all insurance practitioners in Nigeria. Established by the Act of Parliament no. 22 of 1993, its main objectives are:

i. Determine the standard of knowledge and skill to be attained by insurance practitioners as well as reviewing standards of insurance in general;

ii. Promote insurance education and professional training including the conduct of professional examinations;

iii. Maintain the register of practitioners and members; and

iv. Promote professional insurance and reinsurance practice in Nigeria

Pursuant to its object clause of promoting insurance education in Nigeria, the governing Council of the CIIN established the College of Insurance and Financial Management (CIFM) to train and reposition graduates and non-graduates of Insurance to make career in Insurance. The programme of the College is specifically geared towards assisting students attain professional qualification in Insurance within a short time. In line with this goal, graduates of the 9-months diploma programme enjoy 6 exemptions in the CIIN Professional Examinations to underscore the premium placed on its training programme. They will only write and pass the remaining six papers to qualify as insurance professionals.

The Institute’s members are categorised into Fellows, Associates, Student members and Ordinary members. The last category of membership is made up of employees of insurance companies who are not professionally qualified but are involved in insurance activities in the country. This is to ensure that everybody plays by the rules guiding the industry. The Association currently has a total membership strength of 8171 as at June 2016 broken down to 229 Fellows, 2913 Associates, 59 Seniors and 4970 Ordinary members.

The Nigerian Insurance Association

The Nigerian Insurance Association (NIA) was established in 1971 as the umbrella body for all insurers in the country. The body strives to promote and uphold the universally accepted standards of business ethics and professional integrity in the industry. As a body of insurance underwriters, it is committed to enhancing the image of the Insurance Industry and promoting the common interest of its members. As part of its contributions to the development of the Insurance Profession, the body often makes contributions to legislation that can impact the industry. It is indeed, the voice of insurers. In order to ensure compliance to best practices in the industry, NIA has a complaints bureau to which members and other stakeholders can have recourse if they feel aggrieved.

National Council of Registered Insurance Brokers (NCRIB)

The Nigerian Corporation of Insurance Brokers, the precursor of NCRIB, was established in 1962 to provide a central organisation for the regulation of all practicing insurance brokers in Nigeria. With the enactment of the NCRIB Act of July 3, 2003, its name was statutorily changed to the National Council of Registered Insurance Brokers thereby making insurance brokerage business a recognized professional endeavour. The body was then charged with the responsibility of regulating this critical arm of the Insurance Industry in Nigeria, the Insurance Broking profession. As one of the most active trade groups in the insurance market, NCRIB is a platform for all registered insurance brokers in Nigeria which number over 350. As intermediaries, they help to create awareness about the Insurance Industry and its diverse products as well as market them to would-be buyers. They strive to explain the grey areas of various policies to would-be buyers of insurance policies and are statutorily allowed to collect premium on behalf of insurers. As required by the law, they must remit all premium collections within 30days. The NCRIB was also formed to promote the welfare of its members as well as sanitise the insurance agency business such that the value-driven activity receives the respect it deserves. It is to reinforce this responsibility that the Insurance Act of same year expressly provided that the leadership of insurance broking firms must be persons who are professionally qualified and certified by the CIIN. Thus, the NCRIB sets standards of practice for compliance by its members within the regulatory space provided by its Act, the Insurance Act and NAICOM Act. For instance, it requires all its members to maintain a professional indemnity insurance to be registered in any year as a member of the Council.

The Institute of Loss Adjusters of Nigeria (ILAN)

Loss Adjusters are professionals who operate between the insurers and the insured to ensure that claims arising from accidents are appraised, validated and justified based on the terms and conditions in the policy, before they are honoured. They ensure that policyholders are fairly treated and compensated without short changing the insurer. Thus, Loss Adjusters are multi-disciplinary, top level independent, professionally qualified persons who are expected to operate with the highest level of integrity, observing code of professional ethics and international best practices in conducting their practice. Their umbrella body is the Institute of Loss Adjusters of Nigeria (ILAN).

The key objectives of this body are to promote professionalism among the members of the Institute as well as advance the cause of insurance Loss Adjusters in the country. Its membership is segmented into Fellows, Associates and Licentiates. Only professionally qualified insurance practitioners and degree holders in insurance can register to sit for its examinations. There are currently 54 Loss Adjusters registered with NAICOM. The Institute has a Code of Conduct for its members which it strictly enforces in order to ensure that members continue to independently facilitate the settlement of insurance claims. Acting on the insurance company’s instructions, Loss Adjusters undertake the inspection of damaged assets, investigates and reports cause(s) and make recommendations regarding how best to reinstate or settle the claim in accordance with the terms and conditions of the insurance policy. They are driven by objectivity and fairness to all parties involved.

Summary

The regulators of the Insurance Industry are NAICOM, NIA, CIIN, NCRIB and ILAN. These institutions cooperate to promote the development of the Insurance Profession, ensure best practices in the industry by all players such that the buying public derives value. With their respective interventions, insurance business has ceased to be an all-comers business. Professionalism is now the rule.

Funmi Babington-Ashaye