The Commissioner for Insurance, Mr Sunday Thomas, has said the essence of the local content law is not being realised in the insurance sector because many businesses in the aviation and oil and gas sectors were being reinsured abroad.
He urged insurance companies to boost their capacity in order to be able to underwrite huge risks.
Thomas spoke during the insurance directors’ conference in Lagos.
He said, “Operators in the industry must strengthen their human and financial capital for effective participation in big-ticket risks.
“It has been observed that the gains of domestication policy of the government as enshrined in the Nigerian Content Development Act 2010 is gradually losing its meaning for the insurance sector.
“More businesses, especially in the oil and gas and the aviation sectors, are now been reinsured abroad.”
Another concern, he said, was the declining participation of life companies in the annuity business which was the emerging business for the industry.
The commissioner said the industry must invest handsomely in technology, one of the key drivers for developing the market.
He said the institutions should be prepared to digitalise their processes, procedures and systems in order to make their operations seamless and real-time.
The commissioner said the commission was investing heavily in automating its processes and expected nothing less from the insurance institutions.
He noted that an industry Information Technology guideline had been issued for the operators and the commission required their support and cooperation for effective compliance.
According to him, the need to invest massively in an awareness campaign about insurance cannot be overemphasised as there seems to be a consensus that public perception of insurance still remains very low, largely due to a lack of awareness by the public.