VOLUNTARY RATING AGREEMENT IN NIGERIA LOOKS TO HAVE FAILED

A year after insurers in Nigeria signed a voluntary agreement to charge rates that were viable for the long term, the deal appears to be on the verge of collapse because many insurers were not sticking to the rules of the agreement, reports Nigeria's Daily Independent. The Nigerian Insurance Association (NIA) has now begun moves to sanction insurers that charge unsustainable rates, reports Nigeria's Daily Independent. Only a year after NIA members signed the voluntary agreement, several members have announced their intention to withdraw from the agreement and others have said that they are considering it. Mohammed Kari, managing director of UityKaital Assurance, said that his insurer was pulling out because it had become obvious that a number of insurers were only paying lip service to the agreement. Others alleged that some companies were breaching the agreement but were not suffering any sanctions as a result. The rating committee, under the chairmanship of Sovereign Trust Insurance MD Wale Onaolapo, has been mandated to recommend sanctions for non-compliance with the minimum rates.