The insurance business does not take place in a vacuum – Agboola
The President of the College of Insurance Supervisors of the West African Monetary Zone (CISWAMZ), Mr. Agboola Pius, said on Tuesday that insurance business is not done in isolation.
Speaking at the second meeting of the college in Abuja, he said: “The insurance industry has evolved through the desire of entrepreneurs to reduce the negative effects of risk materialization. This is why insurance is seen as a risk transfer mechanism. A business that exists to ensure the survival of other businesses.
According to him, the entrepreneur who creates a business or an insurance company can choose to remain small, serving local markets.
“Alternatively, businesses may not have the opportunity to stay small because there are so many other factors that could cause every business to grow and go beyond jurisdictional boundaries and these factors can be categorized into; factors incentive or attraction.
“Push factors include;
Diminished opportunities in the home jurisdiction, and
· The need for consolidations, etc.
“The pull factors include;
The need to track their customers overseas, which is common in the oil and gas industry
Expected benefits (i.e. large profit margin)
unused potentials, etc.
The Chairman explained that the particular nature of insurance and the fact that it is a financial sector activity means that it is highly regulated in the jurisdiction of operation.
“As the business expands beyond the jurisdiction of establishment or operation, the need for bi-regional or multi-regional cooperation and/or agreement has increased. “Hence the need for this regional integration called College of West African Monetary Zone Insurance Supervisors,” Agboola said.