The federal government has been advised to include insurance in its on-going rent-to-own housing programme.
The housing programme was designed to enhance affordability of houses by eliminating the need for down payments and other cost associated with normal mortgage loan arrangements.
President, Nigeria Council of Registered Insurance Brokers (NCRIB), Mr Shola Tinubu, who stated this at the quarterly press briefing organised by the council in Lagos, said insurance should be included in the programme.
According to him, Section 64 & 65 of the Insurance Act 2003 stipulates compulsory insurance for the ongoing construction projects.
“It therefore behoves on the federal government to insist that appropriate insurance policies be in place for these houses at the construction stage, and for the win-win benefits the project holds for government, the allottees and their families,” he added.
According to him, there are reports that about N197 billion had been spent to construct 26,002 houses across the country, while 13,953 homes across the country had been renovated.
He, however lauded the federal government’s programme.
He added that it would go a long way to address the housing deficit, a serious challenge that any government should tackle headlong.
On the place of Insurance in the programme, Tinubu said, “However, the council wishes to enjoin the federal government, to ensure that in embarking on this laudable feat, insurance should be given its rightful place.”
He also spoke on the recent directive that operators should shore up their capital base, saying, “It is noteworthy that in the bid to ensure a more virile insurance industry, the National Insurance Commission (NAICOM) recently announced new capital regime for insurance companies.
“The new capitalisation system tagged, “Recapitalisation of insurance companies, the tier-based minimum solvency capital,’ would be partially introducing the risk-based capital model in a three-tier recapitalisation system, whereby firms would be graded as tier-three, tier-two and tier-one.”
He, however described the tier system as an independent assessment for solvency, such that companies classified as top-tier could possibly have significant solvency issues.
He said under the new regime, insurance companies would be looking at different options to respond before the deadline of January 1, 2019.
He noted that it was definite that several options would be contemplated by the companies, including the options of injection of capital, mergers and acquisitions, adding that whichever strategy chosen and no matter how disruptive, companies should focus on how to grow the insurance industry as well as how to make insurance an imperative.
He said the NCRIB had set relevant committees in motion to see the extent to which the new policy thrust would affect its members.