The National Insurance Commission (NAICOM) has called on insurers to develop specialised products to address the needs of the oil and gas industry.
Mr Olorundare Sunday Thomas, Commissioner for Insurance and CEO, NAICOM, said this in a keynote address presented at the Oriental News 2023 Summit on the theme, ‘Building Local Contents Synergy between the Oil and Gas and the Insurance Sector in Nigeria.’
He said there is the need to intensify the ongoing drive to facilitate platforms that address the demand-supply gap in the oil and gas industry.
Thomas assured that steps already being taken would address all potential regulatory impediments, support the development of human capacity and ensure technical capacities of insurance suppliers, ensure adequate risk pricing and comprehensive coverages and risk management.
According to him, “As the regulator, we are committed to creating an enabling environment that will consistently enhance increased capacity of the insurance institutions both financially and technically.”
Thomas called for the principles of reciprocity on the part of operators in the oil and gas sector, one of which is timely compliance with the requirements of the guidelines jointly issued by the insurance regulator and the Nigerian Content Development and Monitoring Board (NCDMB).
He noted that it is the ultimate goal of NAICOM to see that following the mandate to develop indigenous capacities to participate in the oil and gas industry, both regulators would, by their collaboration, be able to facilitate, promote adequate assessment of needs of the oil and gas industry and influence the behaviour of insurers, reinsurers and brokers in manners that address the needs for national growth and development.
The NAICOM boss expressed happiness for the privilege to address stakeholders in the oil and gas as well as the insurance sector on the theme, which he noted is very crucial not just to the two industries, but the nation as a whole.
He stated that the drive towards enhancing local content speaks to the long-term plan of the government borne out of good intention and strategy to grow the economy, develop the Nigerian Industries and her human capital.
He said, “It is worthy to note that prior to the Nigeria Oil and Gas Industry Content Development Act of 2010 (NOGICD ACT), the Insurance Act 2003 made far reaching provisions for the domestication and domiciliation of insurance services in Nigeria.
“In particular, Section 65(7) made it compulsory for any property located in Nigeria, whether movable or immovable, to be insured with a Nigerian registered insurer.”
“Section 67 requires that insurance of all imports into Nigeria must be insured by insurers registered in Nigeria.”
Thomas noted that the historical relationship between both Industries could be traced to the birth of the latter, following the issuance of the NOGICD Act, the insurance industry in collaboration with the board brainstormed leading to issuance of the guidelines for oil and gas insurance business issued in 2010 which amongst others, stipulates the roles and responsibilities of insurance institutions in ensuring compliance with local content law, with the primary objective of ensuring actual exhaustion of available in-country insurance capacity.
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