By Sahabi Abdul
Nigeria’s insurance regulator has approved the establishment of micro- insurance departments in existing companies, as part of steps to increase financial inclusion.
Such a department must be headed by an official not below the rank of an assistant general manager, the National Insurance Corporation said on Tuesday on Twitter.
For an approval to be given, there must be a formal application accompanied by a resolution of the board of directors for the establishment of a micro insurance company or department, among other requirements.
Micro insurance refers to risk protection policies aimed at protecting low income earners and small businesses, tailored to their financial capacity.
Nigerian small businesses and low income earners were hit hardest by the key unexpected events this year, such as the lockdown to curb the coronavirus pandemic and the rioting that accompanied the October protests against police brutality . Many low income people and small business owners bore the associated losses without any insurance protection.
A 2016 survey of Nigerian households that only 0.3 million of 96.4 million adults surveyed were aware of micro insurance. The study further indicated that more than 32 million were willing to take up micro insurance products if they had been aware of it.
NAICOM approved the establishment of GOXI Micro Insurance Ltd., as the first licenced micro-insurance company in Nigeria.