Beyond Insurance Apathy: Reviewing the Framework of Legal Rules of Insurance Agents, Brokers, and Loss Adjusters in Nigeria
Nigeria has the second largest insurance sector in Africa, with 2 reinsurance brokers, 54 loss adjusters, 564 insurance brokers and 15,000 insurance agents in their various categories, potentially, with the biggest insurance market in Africa. Agents, brokers and loss adjusters act and carry out their role as insurance middlemen through marketing and communication of complex insurance products and services to end-users. They verify and manage risks with appropriate insurers and help in selecting from competing offers for the insured. Intangible products and services of insurance deals with promises to compensate the insured or a third party based on specified terms and conditions under a policy of insurance, and to cover the contingent event if it occurs. This is an onerous task, a critical one, that impacts individuals, insured, the industry and the economy at large. The important role insurance play in combating economic risks and in helping the world respond intractable risks puts insurance at the front burner globally. Sadly, the insurance middlemen in Nigeria are under-regulated and are still stuck in the traditional approaches, as against innovative marketing, trending globally. Several efforts of the federal government to regulate insurance in Nigeria, have generally not been deeply felt by the middlemen, who should enjoy more regulation to strengthen the sector. The Insurance Act 2004; the primary statutory provision on insurance in Nigeria only provides for fifteen short sections of the law to cover the activities of insurance agents, brokers, loss adjusters and reinsurers. The above scenario engendered apathy, mistrust, unprofessional conduct and insecurity with overall negative impact on the Nigerian economy; and with sad outcomes, nine out of ten Nigerians do not have any form of insurance. Thus, this paper seeks to appraise the insurance middlemen that acts as the conduit between insurance consumers and the insurance companies in Nigeria. The objective is to evaluate their role, given the meager legal provision in place and to see how these can be streamlined and tailored to promote a stronger body of middlemen. Further, to sustain development in the insurance sector and to encourage the use of strong and viable legal reform of the sector to provide adequate protection to consumers in times of loss. This paper recommends that the Nigerian legal regime on insurance middlemen be systematically tailored to this important sector with specialized laws. It is further provided that the subsisting law, now 16 years old, be reviewed and amended to admit of stronger, innovative and an expanded scope of insurance middlemen in Nigeria.
Keywords - Apathy, Framework of Legal Rules, Agents, Brokers, Loss Adjuster, Nigeria