As the May 2010 deadline issued to underwriters to collect their outstanding premiums from debtors draws near, there are clear indications that the premium volume may be significantly be boosted in this operational year. Already, stakeholders have appraised the industry and drew a conclusion that the innovative reforms and supervision of operators under the Fola Daniel led National Insurance Commission, NAICOM, would propel the industry to higher heights. It would be recalled that the commission gave up to May 2010, to insurance companies to collect their outstanding debts from brokers and others. Since that ultimatum, there have been many interesting developments aimed at mending fences and shaping the rough edges between brokers and underwriters. Feelers emanating from both houses, indicate that the hitherto staggering volume of unpaid premium particularly from brokers is being addressed. Of recent, it was gathered that many debtor brokers have been fast off setting their debts so as to maintain a clean bill of health with the National Insurance Commission ( NAICOM) The issue of unpaid premium has been a lingering problem between underwriters and brokers. According to top industry operators, the business relationship between brokers and underwriters which have been lukewarm over time appears to be gaining cordiality. The main reason why this lingered was due to what industry watchers called premium withholding. Speaking on related issue sometime ago, G.U.S Wiggle, Managing director of Linkage Assurance had said that the way the situation was, it was not unlikely most times for underwriters to pay claims for insured perils for which premium was yet to be paid by brokers. NAICOM had mandated insurer up to the end of May to submit their financial returns to the regulator. Desirous to keep to the deadline, the relationship which has been hard to mend in the past is receiving accelerated attention. If the trend is maintained, the over - all premium earnings in the industry would increase substantially this year. The rush by brokers to comply may also not be unconnected with the fact that they have been fighting many battles in recent times with industry stakeholders which seem to threaten their age-long cohesion. Based on the huge indebtedness of most of them, not complying with the regulation would indict them especially as many of them owe over N500.000, a ceiling the regulator would not tolerate.
.It was gathered that one of the reasons why the insurance companies are putting in every effort to sort out their difference was due to the provision in the regulation that outstanding premiums that have remained unpaid for longer than six months will have 50 percent of it written off. On the other hand, unpaid premiums which were over due by one year would be entirely written off. Should such situation arise, it was learnt, insurers may have no choice than to eat into their fragile profits, a situation that would put them at loggerhead with their shareholders. According to Gbenga Tobe, consultant on insurance and pension, one area of conflict between the two bodies had also bothered on mutual distrust which has seen them engaging in accusation of each other. For instance, he stated the accusation by immediate past president of the National Council of Registered Insurance Brokers, Dede Ijere, that insurance companies were merely inflating figures of brokers’ indebtedness in order to maintain a good standing with the regulator. With the renewed war of NAICOM on insurance companies and brokers, the age long practice of unpaid premiums may be erased soon.
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