By Favour Nnabugwu
National Insurance Commission, Naicom has said the commission collaboration with oil and gas magnates is to ensure a preventive, detective, corrective and compensatory control of the oil and gas insurance for the benefit of the sector, star and the federal level.
The nation’s Commissioner for Insurance, CFI, Mr Olorundare Sunday Thomas made this know at the Orient News summit on oil and gas in Lagos submitted that the dividend of an active approach to Joint Regulatory Framework for driving Local Content in Nigeria
“The intention is more tilted towards encouraging preventive, detective; as well as corrective and compensatory regulatory controls”.
Thomas extended the benefit to state as well, “that necessity is on us to ensure that risks are accurately priced and professional advice is given to Insuring entities, especially in the Oil and Gas space, as it poses vantage position to avoiding overpricing of products, underrating of risks, negligent omission of necessary covers and its consequential effect on avoidable pressure and burden on finances”
“The Jointly issued Guidelines portend to satisfy the intent and provision of the laws: thereby enabling the NCDMB monitor utilization of in-country insurance capacity which is a road to increased retention, growth in in-country technical capacity, Job creation, increased penetration and GDP growth, human capacity development, and many others.It is also projected that the Guidelines will entrench effective regulatory oversight”
“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”.
The CFI specifically pointed the section 65(7) made it compulsory for any property located in Nigeria whether moveable 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.
“The synergy between both industries was renewed when both agencies identified the need for a veritable platform for inter-agency collaboration in order to give effect to the requirements of Sections 49 and 50 of the NOGICD Act 2010 by providing guidance to Operators in the Oil and Gas necessary for satisfying the provisions of the law in relation to insurance transactions”.
The journey for the renewed collaboration transited to the signing and unveiling of the Guidelines on submission of Insurance Programme by Operators, Project Promoters, Alliance Partners, and Nigerian Indigenous Companies in the Nigerian Oil and Gas Industry.
Other than the circulation of the Guidelines, there was an official unveiling at the 21st NOG Energy Conference and Exhibition of 4th to 7th July 2022 at the International Conference Center Abuja.I am honoured to at this juncture put in context the Benefits of the Guidelines to our Industries and the Nation in general;
On part of the effort shown by Naicom, Thomas recalled, “The Commission has shown a positive attitude to Market Development by the release of the Soundbox Guidelines which is an instrument to test ingenuities in the Market; hence the Commission seek to facilitate and promote innovative insurance solutions that will address the gaps in current insurance offerings”
“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.Beyond our promises and without pre-empting the paper presenters and discussants, I will express the need for reciprocal expectations from Operators in the Oil and Gas sector, one of which is timely compliance with the requirements of the Guidelines jointly issued by the Commission and NCDMB”
Ok the overall target, the CFI assured, “It is our ultimate goal that, following the mandate to develop indigenous capacities to participate in the Oil and Gas Industry, both regulators would by this 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 addresses the needs for national growth and development.”