The National Insurance Commission (NAICOM) and the Bureau of Public Procurement (BPP) have signed a Memorandum of Understanding (MoU) to harmonize regulatory requirements for issuing insurance bonds in the nation’s public procurement system.
Speaking during the MoU signing ceremony on Monday, the National Commissioner for Insurance/CEO of NAICOM, Mr Olusegun Omosehin, said the partnership would enhance transparency and accountability in the sector and ensure that citizens benefit from the transformation in the sector.
The insurance expert explained that NAICOM was statutorily mandated to ensure insurance providers remained financially sound and capable of meeting their obligations, particularly during hazards.
Omosehin clarified that since insurance services remained a key component of public procurement, closer collaboration with the BPP was necessary to ensure guidelines and requirements are properly defined and enforced.
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He said: “Insurance, being one of those services that will be procured, needs to be properly understood — the guidelines, the requirements, and what it should deliver.”
The NAICOM boss stressed that consumer protection, regulatory capacity building and financial stability of insurance firms remained top priorities for the Commission, adding that achieving the administration’s broader reform agenda requires strong inter-agency cooperation, including the ability to track insurance procurements and ensure compliance after approvals are granted.
In his brief remarks, the Director-General of the BPP, Dr. Adebowale Adedokun, commended NAICOM’s reform efforts and described a strong insurance sector as essential to economic growth.
According to him, the Bureau will be relying more on NAICOM’s technical expertise and data resources when reviewing insurance-related procurement requests.
Adedokun said: “We receive requests for insurance procurement and we do not have the total technical expertise. This handshake today is to say that any time we have requests for insurance, we will seek your guidance to be sure we do not give approvals that we cannot defend.”
He cautioned that unethical practices would not be tolerated in the public procurement processes, hence insurers must adhere to governance standards and professional codes of conduct.
Insurance bonds, also known as financial guarantee insurance, give assurance that bond issuers, such as governments or corporate entities, will repay principal and interest to investors in the event of unforeseen circumstances.
Photo Caption
L-R: Director-General of the BPP, Dr. Adebowale Adedokun; and National Commissioner for Insurance/CEO of NAICOM, Mr Olusegun Omosehin; signing the Memorandum of Understanding (MoU) on Insurance bond issuance on Monday in Abuja
