Eddie Efekoha, the president of the Insurance Industry Consultative Council (IICC),Â Â has expressed confidence that the recapitalization exercise by the National Insurance Commission (NAICOM) would foster industry growth.Â
Speaking at the 2019 IICC Retreat in Ijebu Ode,Â Efekoha said, â€œThe wind of recapitalization is blowing. When we came back from South Africa, we heard that of Ghana and the Central Bank of Nigeria (CBN) and I think the insurance regulator should be recommended for setting the pace.
â€œI can assure you that the operators will not go against our regulator because the consequences of that is too grievous. However, there is a limit at which operators can control other stakeholders like the shareholders and investors. We cannot stop them from speaking their minds, but whatever they have said do not represent the operatorsâ€™/managersâ€™ decision.â€
He gave the reason NAICOM is pushing for the recapitalization as being “the same reasons CBN is giving which are the issues of exchange rate and capacity.
â€œIf these are the main reasons for the recapitalization exercise, the truth of the matter is that the exchange rate that applied in 2005/2007 is not the same in 2018/19.
â€œSecondly, if the exchange rate has changed, our ability to retain businesses have weaken. Should we enhance it? yes! I think we should enhance it.â€
He continued by citing an illustration, â€œIf you pour water into a glass half way, some would described it half empty, others would described it as half full. If you say half empty, then you are not seeing the positive side of the water, but if you say half full, then you are positive. I think it is time for us to see this recapitalization exercise from the positive side of view.
â€œI have never seen a policy that only has the good side and no bad side and no timing can be right because it is only Godâ€™s time that can be the best. I think that the more we are positive about this recapitalization exercise, the more chances we would have on overcoming some of the challenges that comes with it.
â€œThere was a meeting at the Nigerian Insurers Association (NIA) Secretariat to deliberate on the matter and I donâ€™t think operators are looking at the matter from the side of half empty, but they are viewing the matter from the side of half full and whatever we can take out from this, for the good of this market, we will do.â€
On his part,Â Alhaji Femi Hassan who isÂ the president of the Institute of Loss Adjuster of Nigeria (ILAN), said, â€œWe at ILAN want this recapitalization to take place. We are eagerly waiting for it to take place, because it will enable the operators to put some structures in place that will help to grow the industry.
â€œI know the operators want this recapitalization to take place, but the investors who have put their money into the insurance companies are the ones kicking against it, but nevertheless, I am optimistic that in the long run, every party will see reason.â€