Former NAICOM boss oppose licensing of NPF insurance
A former Commissioner for Insurance of the National Insurance Commission, Mohammed Kari, has opposed the licensing of Nigeria Police Force – NPF Insurance Company Limited by the National Insurance Commission (NAICOM). He expressed his objection in a letter dated July 25, 2024 and addressed to the Commissioner for Insurance/ CEO of NAICOM Olusegun Omosehin. Recall, […]
The National Insurance Commission (NAICOM)
A former Commissioner for Insurance of the National Insurance Commission, Mohammed Kari, has opposed the licensing of Nigeria Police Force – NPF Insurance Company Limited by the National Insurance Commission (NAICOM).
He expressed his objection in a letter dated July 25, 2024 and addressed to the Commissioner for Insurance/ CEO of NAICOM Olusegun Omosehin.
Recall, NAICOM had recently in an advertorial in some national newspapers said it has received an application from the NPF Insurance Company Limited for registration as an insurance company to transact insurance business in Nigeria and had requested the public to submit/report any objection or otherwise against the registration to it within 21 days from the date of the publication.
The letter partly reads: “I am writing to formally object to the registration of the NPF Insurance Company Limited, and my objection is based on several critical concerns that I believe warrant serious consideration.
“The core operations of the Nigeria Police Force are fundamentally at odds with commercial activities. The primary mandate of the police is to maintain law and order, not to engage in business ventures. Allowing the police to operate an insurance company could lead to conflicts of interest and distract from their essential duties. The police is a regulator of sorts, they cannot be enforcing the law on compulsory insurance and be a provider of Insurance. The temptation to force motorists to insure with their company will be irresistible.”
Continuing he said: “The structure and ownership requirements stipulated by Nigerian insurance laws and Financial Reporting Council necessitate a level of expertise that is currently lacking within the nominated board of directors and the police force. Another requirement is a spread in ownership to avoid undue influence on the company by one shareholder. The authoritative nature of the police and their potential representation on the board of directors could lead to undue interference in the management of the insurance company, compromising its independence and effectiveness.
“The Nigeria Police Force Investments have a history of mismanagement, as evidenced by the numerous issues surrounding the Nigeria Police Pension Scheme. This history raises significant doubts about the ability of the police to effectively manage an insurance company, which requires a high level of expertise and know-how.
“The fragmentation of the insurance business would result in the loss of valuable data and income for the industry. The entry of the Nigeria Police into the insurance market could disrupt the existing ecosystem, leading to inefficiencies and potential data loss that could harm the overall industry,” he explained.