THE NIGERIAN INSURERS ASSOCIATION

(NIA)IN

PERSPECTIVE

PRINCIPAL OFFICERS OF THE ASSSOCIATION

History of the NIA

For ten years beginning from 1919, an average of 2,900 commercialvehicles were registered in Nigeria annually. 1 It was against this background that the firstinsurance company - the Royal Exchange Assurance Company Limited, was established inNigeria in February 1921. The Company which was, in fact, a Branch Office of a British Insurer, monopolised the market until 1949 when three other British insurance companies established their own Branches or Agencies in the country.

As soon as up to four insurance organisations started operating in Nigeria, the needarose for a body which would handle common problems on behalf of the industry. Consequently, the London West African Insurance Committee was formed with members drawn from insurance companies who had commercial interests in West Africa. The Committee, from time to time, rendered advisory services to the insurance companies operating in Nigeria.

The attainment of political independence in 1960 following which Britain, as an imperial power, ceased to determine the political and economic developments of Nigeria, created the need for a Nigerian based body which would protect the interests of insurers.A further reason for the founding of an association of insurance companies in Nigeria was the proliferation of insurers operating in the country.

By 1960, there were about 25 insurance companies in Nigeria.

Establishment of Insurers Consultative Body In 1951, a Consultative Committee of insurance companies was formed based in Lagos. Under the aegis of the Committee, the chief executives or chief agents of Insurance companies operating in Nigeria met regularly to discuss common problems especially Government policies affecting the insurance industry. The body, however, became moribund after a couple of years.

As most of the earliest insurance companies established in Nigeria were specialised outfits, efforts were made to establish Life Insurance Offices Association and Accident Insurance Offices Association. Their establishment were influenced by the structure of insurance associations in the United Kingdom from where the business of insurance wasintroduced to Nigeria.

On the 9th August, 1962, the representatives of insurance companies operatingin the country met at the Anchor Building, Lagos in a renewed effort to resuscitate theConsultative Committee. Those present at the meeting were:T .A. Braithwaite representing African Alliance Insurance Company Limited.R. E. Blair - African Insurance Limited and Employers Liability Assurance Corporation.A. A.Ayoola - Caledonian Insurance Company Limited.

• C. MacWilliams - Century Insurance Company Limited and Friends Provident and Century Life Office.J. Akin-George - Dominion Insurance Company Limited.G. W Bisset-Lovie - Great Nigeria Insurance Company Limited.B. Land - Guardian Assurance Company limited, Lion of Africa Insurance Company Limited and London Assurance Limited.

J. W. Farnsworth - Guinea Insurance Company Limited, Legal & General Assurance Society Limited and Norwich Union Insurance Company Limited.

V. B. Twyford - Law Union and Rock Insurance Company Limited, London Liverpool and Globe Insurance Company Limited and Royal Insurance Company Limited.

M L. King - National Employers Life Assurance CompanyLimited and National Employers Mutual General Insurance Association Limited.

F .O. Ogunlana - New Africa Insurance Company Limited.J. H Day - Northern Assurance Company Limited.G. A. Bamford - Royal Exchange Assurance. .G. J. White-Parsons - South British Insurance Company Limited.G.W. Fox - West African Provincial Insurance CompanyLimited.

J. J. Gardner - White Cross Insurance Company Limited.The meeting which was presided over by Mr. J H. Day, unanimously decided to reform the defunct Nigerian Insurance Consultative Committee. A draft constitution presented by Mr. Day, was considered and, after some amendments, was adopted on a motion by Mr. T. A. Braithwaite seconded by Mr. J. W. Farnsworth.

In an election which followed, Mr. E. C. McNestry emerged as chairman of the bodywhile the following were elected as members of the Management Committee:J. H. Day J. W. FarnsworthG. W. Fox E .W. Bisset-Lovie, andF .O. Ogunlana V. B. Twyford

At the same time, Mr. L. E. Lainson was appointed as the Secretary of the Association. He served in that capacity until January 1967.

At the time of its resuscitation in 1962, the Nigerian Insurance ConsultativeCommittee consisted of 32 Insurance Companies operating in the country. With theexception of Great Nigeria Insurance Company Limited and Universal Insurance Company Limited, all the member companies were Branches or Agencies of British insurance companies. The Federal Government of Nigeria, Banks and Trade Missions were formally informed of the formation and objects of the committee. A General Meeting of members of the Committee took place quarterly while the Management Committee met every month.

• The Committee maintained a relationship between the insurance industry and the

• Government and also liaised with Government Agencies such as the Police and the Board

• of Inland Revenue. The Committee also liaised with the few insurance brokers operating in the country. Since most of its members were branches or Agencies of British insurers.

the Committee received tremendous assistance from the British Insurance Association (now Association of British Insurers). The assistance took the form mainly of preparation ofmemoranda used by the Committee in communicating to the Government the implicationsof its policies on the insurance industry.

From Consultative Forum to Trade Association

Towards the end of the year 1970, members of the Nigerian Insurance ConsultativeCommittee felt the need had arisen for the emergence of a stronger body of insurers and, consequently, proposed to form an association to be registered under the Companies Act as a non-profit making body limited by guarantee. This development must have been informed by two main factors, namely:

Governmental ControlPrior to 1961, Government maintained a policy of laissez-faire towards insurance business. Thus, apart from the Motor Vehicles (Third Party Insurance) Act of 1945 (revised in 1950), there was no statutory control of insurance. In 1961, the Marine Insurance Act was enacted. This was followed by the Insurance Companies Act 1961. The statute distinguished between local and foreign insurance companies and demanded greater capitalization from foreign companies than that required from local ones

The statute distinguished between local and foreign insurance companies and demanded greater capitalization from foreign companies than that required from local ones. Another landmarklegislation was the Insurance (Miscellaneous Provisions) Act of 1964 which-became effectivefrom 4th May 1967. The Act regulated the investment operations of insurance companies and restricted the insurance of risks within Nigeria to underwriters who were incorporated in Nigeria. The Insurance Companies Regulations 1998 made detailed provisions for the enforcement of the 1961 Act.

The operation of foreign companies in Nigeria through Agencies and Branch Offices was a general feature in the Nigerian economy until 1968 when the Companies Act.(formerly Companies Decree) 1968 was enacted. Under the statute, all erstwhile alien companies were required to be incorporated in Nigeria. Many insurance companies complied with the law while those who were not willing to comply wound up their operations in the country. By 1969, membership of the Nigerian Insurance Consultative Committee had dwindled from 32 to less than 20. A number of small insurance companies were, however, emerging and operating outside the Committee.

Establishment of NICONThe establishment of the National Insurance Corporation of Nigeria (now NICONInsurance PLC) in 1969 as a wholly-owned Federal Government concern with power to compete with other registered insurers and obtain 10% legal cession from them, marked a milestone in the annals of the Nigerian insurance industry. The establishment of NICON was a pointer to the desire of Government to control a commanding height in the industry. In line with its policy of mixed economy, NICON joined the Nigerian Insurance ConsultativeCommittee shortly after its establishment.

Inaugural Meeting of the NIAThe inaugural meeting of the Nigerian Insurance Association was held at Ikoyi Hotel, Lagos, on the 16th December 1971. The meeting, which was chaired by Mr. E. C. McNestry, the then Managing Director of Royal Exchange Assurance Nigeria Limited, was attended by the following:F . Taylor representing American International Ins.

Co. Nig. Ltd.J. H. Day - Friends Provident & Century Group, and TheUnited Nigeria Insurance Co. Ltd.F .O. Ogunlana " Great Nigeria Insurance Co. Ltd.A. T. Cain " Guinea Insurance Co. Ltd.

V H Twyford - Law Union & Rock Insurance Co.of Nigeria Ltd.

M. J. S. Bedi - The Lion of Africa Insurance Co. Ltd.

K. Wood - National Employers Life Ass. Co. (Nig.) Ltd. and National Employers Mutual

Ins Co. (Nig.) Ltd.

E. C. McNestry - New Africa Insurance Co. Ltd. & Royal

Exchange Assurance (Nigeria).K C. Matthew - New India Assurance Co. (Nigeria)

Ltd.J. Acton - Phoenix of Nigeria Assurance Co. Ltd;M. H Black - Sun Insurance Office (Nigeria) Ltd.J. O. Irukwu - Unity Life & Fire Insurance Co. Ltd.D. MacPhee - West African Provincial Ins. Co. Ltd.B. Addinall - Niger Insurance Co. Ltd.

The meeting unanimously decided to invite Mallam Aliko Mohammed; Chairmanof the National Insurance Corporation of Nigeria, to be the Chairman of the Association.

• The following were then elected into various offices:

TrusteesF .O .Ogunalna, K. Wood and T. A. Braithwaite

Vice Chairmen E. C. McNestry and J. H. Day

SecretaryA. A. Obakeye

Treasurer P A. Dawodu

Auditors .

• Akintola Williams & Co.

Other elected members of the Management Committee were:

A. T. CainF .O. OgunlanaV. H. Twyford

T. A. Braithwaite and K. Wood

The election of Malam Aliko Mohammed as the first chairman of the Association was a recognition of

the leadership status of NICON in the industry and the importance attachedby the NlA to its liaison function with the Government especially in an era of Government control. Mallam Aliko served the Association effectively from December 1971 until heretired from the NICON Board in 1976.

• In January 1981 the Association was incorporated under the Companies Act 1968 as a company limited by guarantee. The body thus acquired juristic personality and became capable of enforcing its rights including rights to acquire property in its own name rather through trustees.In 1990, the Association changed its name to Nigerian Insurers Association so as to clearly reflect its professional and business status.

MISSION STATEMENT

Protecting and advancing the common interest of insurers in Nigeria by creating and sustaining a positive image for the insurance industry and contributing to legislation and decisions made by the Governmentand other Public Authorities in the best interest of the industry in particular and the national economy in general.

OUR OBJECTIVESThe objectives of the Association are embodied in the Constitution of the Association.Some of them are highlighted as follows:To protect, promote and advance the common interest of insurers in Nigeria

To advise members on any action or proposed action by Government or any other authority inconnection with any legislation or policy.To advise or cons un with the Government regarding any act or thing done or being contemplated by itor its agencies or other statutory bodies with regard to any matter relating to Insurance business.

To guide and assist members in complying with laws, regulations, orders and Government directives relating generally to the business of Insurance

To create better understanding of Insurance by all sections of the community including the furtherance of knowledge and research on Insurance and related matters.

To collect, collate and disseminate statistical, economic and other information relating to Insurance . To maintain constant dialogue with other trade associations in the Insurance industry with a view to fostering good relationships between them and the N IA as well as the insuring public.

To confer, consult, maintain contact and co-operate with individuals, associations, societies

institutions or bodies within or outside Nigeria having objectives similar to those of the Association. To promote personal and friendly relationship among members of the Association.The above objectives are achieved by:

Regular meetings of the specialized committees of the Association every month where issues affecting the industry are addressed.

Maintenance of a well equipped research and statistics department.

Organizing conferences, seminars and training courses for employees of member companies and interested public.

Maintaining highly skilled manpower conversant with modern information and communication technologyInteracting positively with the media and other interested groups

Interacting with supervisory authority and the entire membership of the Association

NIA TECHNICAL COMMITTEES• ACCIDENT OFFICES COMMITTEE• ACCOUNTING TECHNICAL COMMITTTEE• CORPORATE AFFAIRS COMMITTEE• FIRE OFFICES COMMITTEE• HUMAN CAPITAL COMMITTEE• INFORMATION TECHNOLOGY COMMITTEE• LEGAL COMMITTEE• LIFE OFFICES COMMITTEE• MARINE OFFICES COMMITTEE

NIA GOVERNING COUNCIL

I. A. BALOGUN mniChairman

Managing DirectorEquity Assurance Plc

WOLE B. OSHIN, ESQ.Vice Chairman

Managing DirectorCustodian and Allied Ins. Plc

OYE HASSAN-ODUKALE, MFR(Past Chairman)

Managing DirectorLeadway Assurance Company Ltd.

PROF. J. O. IRUKWU, SAN(Past Chairman)Consultant to

ADIC Insurance PLC.

GBENGA AFOLAYAN, ESQ.Hon. Treasurer

Chairman/Chief Executive OfficerGoldlink Insurance Plc.

BODE AKINBOYE, ESQ.Hon. Asst. Treasurer

Group Managing DirectorStandard Alliance Insurance Plc

SEUN AJAYI, ESQ.Executive Vice Chairman

Sovereign Trust Insurance Plc.

A.A. FALADE, ESQChief Executive Officer

Guardian Express Ins. Co. Ltd.

•

CHIEF THEOPHILUS EGESI-EKEManaging Director

Union Assurance Company Ltd.

F . K. LAWAL ESQManaging Director

Sterling Assurance Co. Ltd.

OLUMIDE FALOHUN, ESQ.Managing Director

Law Union & Rock Ins. (Nig.) Plc.

S.O. OYEFESO ESQManaging Director

STACO Assurance Plc.

O. LADIPO-AJAYI, ESQ.Managing Director

LASACO Assurance Plc

REMI OLOWUDE, ESQ.Executive Vice Chairman

Industrial and General Insurance Co. Ltd.

DANIEL OKEHI, ESQ. .Managing DirectorInsurance PHS

A. N. OVIOSU, ESQManaging Director

Crusader General Ins. Plc.

DAVID SOBANJO, ESQ.Managing Director

Aiico Insurance Plc.

J. C. URANTA, ESQManaging Director Niger Insurance Plc.

GODWIN U. S. WIGGLE, ESQ.Managing Director

Linkage Assurance Plc.

K. K. YUSUF, ESQManaging Director

Nigerian Agric. Ins. Corp.

INSURANCE INDUSTRY UPDATEThe insurance industry has just successfully completed its consolidation exercise and is positioned to improve its contribution to economic development and remain competitive globally. It is therefore expected that the present state of the insurance industry will no doubt help to stem foreign exchange outflow and boost domestication of special risks such as Oil & Gas, Energy and Aviation business.

The insurance industry witnessed appreciable growth in the volume of business written in year 2006. The industry recorded a gross premium income of N82.89billion in 2006 as against N76.3billion in 2005, an increaseof7.8%.

CHALLENGES FACING THE INSURANCE INDUSTRY

Most post consolidation challenges facing the insurance industry, such as gradual increase in market capitalization, judicious application of new capital, human capital development, cultural integration ofmerged companies, threats of insurance fraud, threat of soft market practice and unethical behaviour will receive great attention so that the insurance sector can play its role as catalyst for national economicdevelopment.

INDUSTRY PERFORMANCE

• Gross Premium 2002 2003 2004

N N N

21,247,328 28,872,944 35,197,652 2005 2006

N N

42,149,876 44,461,037

CLAIMS PAIDNON-LIFE BUSINESS

2002 2003 2004N N N

4,628,746 6,073,094 7,810,243

2005 2006 N N

8,702,592 10,026,155

THANK YOUReferencesCOLLABORATION OF INSURERS IN NIGERIA:HISTORY, ORGANISATION AND ACHIEVEMENTS OF THE NIGERIAN INSURERS ASSOCIATION

BY REV. FUNMI ADEYEMI

2007 NIGERIA INSURERS DIGESTA STATISTICAL JOURNAL OF THE NIGERIAN INSURERS ASSOCIATION.

THE END