W’African Insurance Regulators Formalise Cross-Border Supervision | Independent Newspapers Limited
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Business, Insurance

W’African Insurance Regulators Formalise Cross-Border Supervision

Posted: Sep 10, 2015 at 12:00 am   /   by   /   comments (0)

Stories by Sola Alabadan,


The insurance supervisors of Nigeria, Ghana, Liberia, Sierra Leone, and The Gambia have established West African Insurance Supervisors Association (WAISA) to formalise cross-border supervision in the sub-region.

The Multilateral Memorandum of Understanding (MMoU) to this effect was signed at the office of National Insurance Commission (NAICOM) in Abuja recently, and the Economic Community of West African States (ECOWAS) has been notified of the new association. Both Liberia and The Gambia were, however, absent at the event.

The agreement was championed by NAICOM since many subsidiary insurance companies authorised by Ghana, Liberia, Sierra-Leone and the Gambia to conduct insurance business in the sub-region are owned by Nigerian insurance companies including NEM Insurance, Regency Alliance, Equity Assurance, Wapic Insurance, Staco Insurance, and Capital Express Assurance.

The increased activities of these Nigerian insurance companies in West Africa made the National Insurance Commission (Ghana), Central Bank of Liberia, Sierra-Leone Insurance Commission and Central Bank of the Gambia agreed to sign the MMoU.

According to the Commissioner for Insurance, Mohammed Kari, the MMoU was to formalise the relationship among the parties in strengthening cross border insurance supervision through information sharing and mutual cooperation, which are in conformity with International Association of Insurance Supervision (IAIS) principles.

He added that the MMOU will also help the regulators to effectively communicate with each other in addressing fraud across jurisdictions in compliance with the Financial Action Task Force (FATF) recommendations on Anti-Money Laundering.

The MMoU was to facilitate group-wide supervision, entailing in particular, but not limited to, an assessment of the group’s financial situation, compliance with the rules on solvency, risk concentration and intra-group transactions, and system of governance.

It was also intended to enhance solo supervision of insurance entities by the supervisors as well as provide a permanent forum for cooperation to build relationships between the members, coordinate supervisory activities and engender greater cohesiveness in cooperation between the supervisors.

Besides, the agreement was equally to foster a better understanding of supervisory practices and more efficient and effective supervision as there are significant differences in the supervisory practices of the various supervisors, due to the specific features of each local market, which are better understood by the relevant supervisors.

The concept of an association of regulators is certainly not new to the sub-region as the banking regulators have been making use of this approach for some time now.  Also in July this year, the West African Securities Regulators met in Abuja to sign a MoU for mutual cooperation.