General News
Insurance and Banking in Nigeria: Any Relationship?
Under the financial services sector, banks and insurance companies fall within the same tripod, alongside the capital market. As the Central Bank of Nigeria continues in its reform of the banking sector, the National Insurance Commission {NAICOM} has also not been left behind in the formulation of policies and other regulatory frameworks. However the question agitating the minds of industry watchers is why despite efforts put in place, the insurance industry has not occupied the ideal position in Nigeria. Elsewhere, insurance provides a leadership role to other segments of the financial sector, with many banks being owed by insurance companies. What is the role of insurance in the development of any economy, particularly in Nigeria where insurance seems to be crawling instead of running. While appreciating the professional efforts already in place to change the trend, it is expedient to guide the public on what relationship if any, exists between the banks and insurance. According to Mr. Adeyemo Adejumo, managing director of Continental Reinsurance plc, “traditionally, the financial services sector is commonly classified along the lines of banking and non-banking institutions with insurance taking a pride of place in the latter class.” He explained that “globally, banking and insurance have evolved as playing leading roles in the activities of the financial services industry, stressing that over the years, there have been arguments and counter arguments about the ‘ideal’ relationship that should exist between banking and insurance practices and this has also been recognized by governments around the world.” The Continental Reinsurance boss who delivered a paper on the relationship between banks and insurance at a public forum, said that in the United Kingdom for instance, the Financial Services Authority (FSA) was established as the single regulatory body for both the banking and insurance industries, in recognition of the fact that although some differences may exist in their operation, to a great extent there exist some meaningful relationship between them. He said the Financial Services Act of 1999 has far-reaching and major implications towards the movement of globalization in the banking industry. The bill first and foremost, he said, allows mergers between different sections of the industry that were previously not allowed, a situation which allowed insurance companies to merge with banks.
Adejumo explained that in Canada, for instance, the Bank Act and accompanying regulations contain specific rules pertaining to chartered banks and their involvement in the insurance business. The Insurance Business (Bank and Bank Holding Companies) regulations authorize banks to sell certain insurance products closely related to their lending businesses. Banks may also sell other types of insurance through subsidiary companies, subject to certain restrictions. He explained that as a result of the globalization and liberalization of the financial services industry, many financial institutions are participating in the business activities of other financial institutions, banks and insurance companies in particular. “Several European countries have made considerable regulatory changes regarding the banking and insurance sectors. Although regulatory changes vary from country to country, there has been a pan-European trend towards the ‘Universal Bank’ and the limitations of the past no longer exist. Banks are now able to operate across a broader range of activities, including insurance, via legally independent risk carriers. The insurance companies and banks are not competing within just the life insurance industry and banking industry respectively anymore but within the wider financial services marketplace,” he said. The reinsurance expert stressed that in Nigeria, following the Central Bank of Nigeria’s approval-in-principle of the adoption of universal banking, it released Guidelines for the Practice of Universal Banking in Nigeria in December 2000.
According to the guideline banking business in Nigeria was defined as “the business of receiving deposits on current, savings or other accounts, paying or collecting cheques drawn or paid in by customers, provision of finance, consultancy and advisory services relating to corporate and investment matters, making or managing investment on behalf of any person and the provision of insurance marketing services and capital market business or such other services as the Governor of the Central Bank of Nigeria which may, by gazette, designate as banking business.” This implied that banks are free to choose which activity or activities to undertake, whether it is money or capital market activities or insurance marketing services or a combination thereof and are expected to comply with the guidelines specified for such activity or activities.
Consequently he said, a bank will be regulated based on the type of activities it engages in.
This situation led to the issuance of a single uniform license to all conventional banks which are
National Identity Management Commission (NIMC), has explained why kidnappers and terrorists are not always traceable despite the country’s expanding digital identity infrastructure.
NIMC explanation pointed to a simple but significant gap in the system.
Abisoye Coker-Odusote, director-general of the agency said that: “A lot of the time, you find out the kidnappers use the phones of the people they have abducted, which means how do you trace them because they are not using their own phones?” she said.
Coker-Odusote spoke during an appearance on Channels Television, where she was asked to explain why criminals remain difficult to trace despite the mandatory NIN-SIM linkage policy.
She said criminals frequently frustrate investigations by using mobile phones belonging to their victims, instead of their own registered lines.
“We already know the NIN is the foundational identity for the security architecture, but a lot of the time, you find out the kidnappers use the phones of the people they have abducted. Which means, how do you trace them because they are not using their own phones?” she said.
She also suggested that some criminal elements involved in kidnapping operations may not even be captured in Nigeria’s identity database.
“There is a theory that it may be possible that these kidnappers are not Nigerians and are brought into the country 48 or 72 hours before a kidnapping takes place specifically for that purpose. I’m not insinuating anything, but if that were the case, they naturally would not be captured in our database,” she added.
The comments have revived questions about whether expectations placed on the NIN-SIM linkage have exceeded what the system was designed to deliver.
The NIN-SIM linkage exercise was introduced by the Nigerian Communications Commission (NCC) in collaboration with NIMC to strengthen identity management, eliminate anonymous SIM ownership and support national security.
Over the years, the exercise resulted in millions of subscribers linking their SIM cards with their National Identification Numbers, while telecom operators also deactivated millions of lines that failed to comply with regulatory directives.
Earlier, the NCC maintained that the policy was aimed at improving the integrity of Nigeria’s SIM registration database, strengthening identity verification and supporting security agencies in criminal investigations.
The regulator also described the exercise as an important component of the country’s digital economy and national security framework.
Telecommunications operators have consistently maintained that while they play a critical role in implementing the NIN-SIM linkage policy, they are not responsible for tracking criminals.
Quest Merchant Bank recently hosted the second edition of the Great Place to Work® Nigeria Study Mission, reaffirming its commitment to fostering a high-performance workplace culture and advancing people-centric leadership practices.
The Study Mission serves as a collaborative learning platform that brings together Great Place to Work® Certified organizations to exchange insights, share best practices, and strengthen workplace cultures.
The event welcomed Human Resources leaders and representatives from FITC, Princeps Credit Systems, Tonic Technologies and Esentry Limited for an engaging and insightful session focused on building thriving workplace cultures, promoting continuous learning, and advancing employee-centric practices that drive organizational success.
Speaking at the event, Tolulope Dayo-Peters, Head of People Management, emphasized the importance of continuous learning and collaboration in building sustainable workplace cultures.
“We are delighted to host the second edition of the Great Place to Work® Nigeria Study Mission. At Quest Merchant Bank, we believe building a great workplace is an ongoing journey rooted in trust, purposeful leadership, and a genuine commitment to our people.
“We are pleased to share the practices that have shaped our culture and look forward to more opportunities to learn and collaborate with like-minded organizations.”
Also speaking at the event, Afolabi Olorode, Acting Managing Director/CEO, Quest Merchant Bank Limited, highlighted the critical role workplace culture plays in driving long-term business success.
“We recognize that a strong workplace culture is fundamental to sustainable business success. Creating an environment where our people are empowered to grow, innovate, and perform at their best enables us to consistently deliver value to our clients and stakeholders. We are proud to support initiatives like the Great Place to Work® Nigeria Study Mission that encourage organizations to learn from one another and collectively raise the standard of workplace excellence in Nigeria.”
The Study Mission reinforced the importance of collaboration among organizations committed to creating exceptional employee experiences.
By providing a platform for open dialogue, peer learning, and the exchange of practical ideas, the initiative enabled participants to explore innovative approaches to employee engagement, organizational culture, leadership development, and talent management while strengthening a growing community of employers dedicated to workplace excellence.
Hosting the Great Place to Work® Nigeria Study Mission further strengthens Quest Merchant Bank’s position as a thought leader in workplace culture and talent management.
It also enhances the Bank’s employer brand and demonstrates its unwavering commitment to creating an environment where employees can grow, innovate, and achieve their full potential.
Quest Merchant Bank remains committed to championing initiatives that promote learning, innovation, and people-centric leadership. Through strategic partnerships and knowledge-sharing platforms such as the Great Place to Work® Nigeria Study Mission, the Bank continues to contribute to the advancement of exceptional workplace cultures and the future of work across Nigeria’s corporate landscape.
Nigeria Hydrological Service Agency (NIHSA) has warned of possible floods in parts of Adamawa, Bauchi, Edo, Imo, Enugu, Akwa Ibom, Cross River, Kaduna, Plateau, Niger, Benue, and Borno states within the next seven days.
According to information posted on NIHSA X handle, the Agency announced medium flood advisory in force for the next 7 days across Adamawa, Bauchi, and 11 other States.
“Localised inundation is forecast along the main channel; named communities below sit on the projected footprint. Stations: Saminara on the Karam river, Waya Dam Site on the Waya river, Amber on the Amber river.
“Adamawa; Lemsa, Lamurde, Numan Exposure: 147 comm. 49 schis 40 hith 6 mkts17 relig. Bauchi-Bauchi, Ningi, Shira. Exposure: 4 comm. Kaduna; Chikun, Giwa, Igabi, Jaba, Jema’a, Kachia, Kaura, Kauru, +6 more. Exposure: 1 comm.
“Borno-Gubio, Mobbar. Exposure: 680 comm. 8 schls 6 hith 5 mkts 21 relig. Edo-Akoko-Ed, EtsakoEa, EtsakoWe, Ikpoba-Okha, Orhionmw, OviaNort, OviaSo.. Exposure: 3 comm.
“Imo-Aboh-Mba, Oguta, Ohaji/Eg, Okigwe, Owerri North, Owerri West. Exposure: 3 comm. 7 more states affected and severity LGAs”.
NIHSA advised people in the affected areas to “do NOT cross flooded roads, bridges, or fast-moving water on foot or by vehicle.
“Clear drainage channels and river-mouth blockages; avoid building or living in the floodplain and move people, livestock and valuables from the floodplain to pre-identified higher ground,” NIHSA stated.
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