The National Insurance Commission (NAICOM) has issued operational guidelines which require intending Web Aggregator to pay N2.5 million as licensing fee.
In addition, the intending aggregator is required to pay a non-refundable fee of N500,000, while license renewal will cost N1 million.
According to the insurance practices regulator, the guidelines will serve as a working document to register, supervise and monitor web aggregators.
Apart from the above requirements, the NAICOM also pegged the minimum share capital of a web aggregator at N5 million as at the date of application and shall continue to maintain same throughout the license period, even as he shall submit to the Commission, a financial position duly certified by an External Auditor every year after finalization of books of Accounts.
The industry regulator stated that Insurance levy payable by Web Aggregator shall be one per cent of the gross commission income or minimum of N200, 000, whichever is higher.
Similarly, the guidelines require that the commission to be paid by the insurer partner to Web Aggregator shall not exceed 30 per cent of the brokers commission as stated in Section 53 of the Insurance Act, 2003.
The guidelines further stated: “A Web Aggregator shall put in place a robust LMS and transmit leads at no extra cost to the insurers. The insurer shall keep adequate records of commission paid to a Web Aggregator.”
On payment of premium under web Aggregation, the industry regulator stated that operations shall be guided by Section 50(1) of the Insurance Act 2003 which provides for receipt of an insurance premium as condition precedent to a valid contract of insurance and highlighted further that there shall be no cover in respect of an insurance risk, unless the premium is paid in advance i.e. ‘No premium, No cover.’
The NAICOM also required, based on the guideline, that insurance intermediary who maintain a website for providing information on products of different Insurers is covered by this guideline.
It stated that it remained the responsibility of Web Aggregators to obtain any clarification required on the applicability of the guidelines, and any other regulations from it.
