NAICOM Promises To Assist West African Countries Develop Risk Based Supervision Framework

By Sola Alabadan

The National Insurance Commission (NAICOM) has assured West African Countries that it is ready and available to assist them in developing their Risk Based Supervision (RBS) framework, RBS manual and for knowledge sharing.
The Chairman Of The College Of Insurance Supervisors Of The West African Monetary Zone (CISWAMZ), Mr Pius Agboola, gave this assurance during the second meeting of the College in Abuja.
Agboola, who is also NAICOM’s Director, Inspectorate Directorate, stressed that Nigeria would be glad to share the RBS Framework for Insurers and Reinsurers in Nigeria with member states.
He said the hosting of the Regional RBS by NAICOM and Toronto Centre, Canada in February 2022 has enriched the commission’s understanding of the Risk Based Supervision and Risk Based Capital.
While pointing out that insurance business is not done in isolation,
he said the entrepreneur who establishes an Insurance Company may choose to serve only the local markets or the company may expand and go beyond the shores of the jurisdictions.
He listed the factors to include; risk diversification, declining opportunities in the home jurisdiction, and the need for consolidations.
Other factors, according to him, include; the need to follow their clients abroad which is common in the oil and gas sector, expected benefits and available unutilised potentials, among others.
He added that “The special nature of Insurance and the fact that it is a business in the financial sector entails that it is highly regulated in the jurisdiction of operation. As the business expands beyond the jurisdiction of establishment or operation, the need for bi-regional or multi-regional co-operation and/or understanding grew. “Hence, the need for this regional integration called College of Insurance Supervisors of the West African Monetary Zone. The College is also established to Complement and implement the ideas, Projects and directives of the parent body – WAISA.”