Recapitalisation: Research suggests NAICOM’s RBS approach may be less effective

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NAICOM moves to shut insurance firms over claims failures

NAICOM moves to shut insurance firms over claims failures

•Lists factors limiting sector growth

By Cynthia Alo 

A new development has emerged that the Risk Based Supervision (RBS) enforced by the National Insurance Commission, NAICOM, to assess systemic risk that affects the industry as a whole is less likely to impact the recapitalisation of the industry.

NAICOM had introduced the approach when recapitalisation exercise was halted by litigation, to help strengthen the recapitalisation of the industry.

Vanguard had reported that the Commissioner for Insurance, Mr. Sunday Thomas, while speaking on RBS said that the supervisor is expected to assess systemic risk that affects the industry as a whole, and then analyse the level of risk specific to each firm to the insurance sector.

But a research by Afrinvest, a Lagos based investment house, tagged, ‘Afrinvest Insurance Sector Update Report 2022’, stated that instead of introducing risk-based capitalisation, NAICOM should assess the impact of the current…



Source: Vanguard Newspaper