National Insurance Commission (NAICOM) has estimated nearly N450 billion income for the insurance market by 2010 if the recapitalisation and consolidation of the industry delivers on its projections. It says the income is based on current benchmark and business volume resulting from a higher capitalised market.

Assets base of the industry will also total N.5 trillion in 2010 while total market capitalisation will increase to N350 billion from its 2005 figure of N62.4 billion.

From market penetration of 0.7% and world ranking of 84, the industry may inch to a little higher than 2.5%.

With these figures, the commission predicts that in 2010, the overall ranking of Nigerian market in the world may come to at least 25 from the current 65 as contained in Sigma, a journal published by Swiss Re.

In addition, its African rating and ranking will improve while improving the market’s competitiveness.

NAICOM’s Director of Market Development, Mr. Sunday Thomas, delivering a Regulator’s report at a one-day recapitalisation workshop in Lagos, said that insurers must brace up for the challenges ahead.

He said the recapitalisation was the platform to deliver six major goals of the reform. According to Mr. Thomas, the emergence of “bigger stronger players with enhanced capacity” and restoration of public confidence in insurance will be derived from the reforms.

Also, with the projecting standing of the industry in the national economy, insurance industry’s international competitiveness will be enhanced, he said.

He added that it was not only proper for local insurers to trade in international market but the local market should be so strengthened as to attract foreign players.

Mr. Thomas also reminded operators of their role in driving other reforms in other sectors. For instance, the compulsory annuity plan and Group Life Insurance in the Pension Bill would be well implemented if insurers enhanced their capacity. But warned that insurers might not consider themselves favoured already because they have competitors in the banks.

While he commended efforts so far taken by insurers to recapitalise, he was worried that six months to the deadline, some insurers were asking questions that do not convince the regulators that they are taking the matter seriously.

His words, “If by today you are still making plans to enter the market, forget it, it is too late”, explaining that the procedures to be followed would not be completed until December and that would be too late.

He regretted that many insurance companies were not filling their monthly progress reports as demanded in NAICOM’s recapitalisation guidelines, and sressed that the reports were inbuilt mechanisms to detect problems faced by players during the process and appropriate response made by the regulator.