By Habeeb Ibrahim
The Nigeria Insurance Industry Reform Bill, 2024 (SB 393), sponsored by Senator Tokunbo Abiru, aims to revitalize the nation’s insurance sector and bring it up to par with global standards, thanks to his contributions and leadership as Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions.
This was emphasized in a statement released by Media Aide to Senator Tokunbo Abiru, Enitan Olukotun on July 20, 2024.
Senator Abiru, the Chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions, led the debate, emphasizing the need for a comprehensive legal framework to regulate and supervise all types of insurance businesses in Nigeria. He highlighted the stark reality of the country’s low insurance penetration rate, which stands at 0.5%, placing Nigeria 70th globally and 5th in Africa.
“With its young and vibrant population and growing GDP, Nigeria has immense potential for exponential growth in the insurance sector,” said Senator Abiru, a seasoned economist and former bank chief executive. “However, to fully capitalize on these opportunities and drive economic growth, the industry must undergo essential reforms.”
Senator Abiru criticized the outdated nature of existing laws such as the Insurance Act of 2003, the Marine Insurance Act, the Motor Vehicles (Third Party Insurance) Act, the National Insurance Corporation of Nigeria Act, and the Nigeria Reinsurance Corporation Act. He stressed that these laws no longer adequately address the innovations and dynamics currently shaping the insurance industry.
The proposed bill seeks to consolidate these laws into a robust regulatory framework that will enhance the sector’s contributions to Nigeria’s goal of becoming Africa’s financial hub and one of the world’s top twenty economies. The bill also aims to shift from rule-based supervision to more effective risk-based supervision.
The Senators voiced strong support for the bill, praising its provisions and Senator Abiru’s efforts in crafting a well-researched piece of legislation. They expressed optimism that the bill, once enacted, will significantly reform and invigorate Nigeria’s insurance industry.
The bill’s passage marks a pivotal step toward modernizing the insurance sector, fostering economic development, and positioning Nigeria as a competitive force in the global financial arena.
