Market Conduct and Business Practice Guidelines for Insurance Institutions

Preamble, Objectives and Practices

a. These Guidelines are issued in exercise of the powers conferred on the Sierra Leone Insurance Commission (SLICOM) under the Insurance Act 2000 and the Insurance Act 2016. 

b. These Guidelines shall form part of the extant insurance regulatory and supervisory tools and shall be read in conjunction with the provisions of the Insurance Act as well as other regulations, directives, notices and circulars that the Commission may issue from time to time.

c. These Guidelines shall apply to all Insurance Institutions.

d. Every insurance institution shall establish internal policies and procedures to give effect to the provisions of these Guidelines and shall form part of its internal control.

e. All Insurance Institutions are required to formally direct their staff to comply and ensure strict compliance with these Guidelines.

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SLICOM Checklist

A.  Duly completed Application Form;

B.  Evidence (receipt) of payment of Renewal Application Fee;

C.  Tax Clearance Certificate and NASSIT Clearance Certificate;

D.  Professional Indemnity Policy/Renewal Endorsement;

E.  Certificate of Compliance of the Insurance Act from the External Auditor;

F.  Statutory Declaration on Oath which shall contain the following:

i.  Company does not hold financial interest in excess of 10% in an Insurance/Reinsurance Company in Sierra Leone;

ii. Company does not hold directly or indirectly financial interest in any loss adjusting company;

iii. Sworn Declaration of reasonable care to ensure compliance with the Insurance Act and authenticity of any statement, information, book or any document whatsoever submitted;

G.  Other Declarations which shall contain the following:

i.  That proper records are kept of all business transacted during the preceding year;

ii. Premium Income Collected/Received on behalf of Insurance Companies;

iii. Declaration that no Director of the Brokerage is an employee of any Insurer/Reinsurer;

iv. Current contact details of the CEO and one Top Management Staff;

v. Summary of annual business transacted/commissions received;

vi. Evidence of payment of requisite Levy;

vii. Original copy of the expired certificate;

viii. Evidence of the current CEO's qualification;

ix. Payment of any other outstanding fee/penalty (if applicable)

Statement by the Commissioner of Insurance

Good morning all. It is with great pleasure that I welcome you all to the Commission this morning.

I know that sometime in 2018, I had an engagement with the entire market and some of you were present at that meeting. During that meeting, I tried to lay out to those present my vision for this market. I stated then that I wanted us all to build a trusted insurance market.

I still believe in that so I have requested you all to come today so that we can all be part of the process of building a “Trusted Insurance Market” especially when one takes into consideration that this is generally a broker-driven market and besides the brokers and agents are the first underwriters. You moreover play a vital role in the supply chain for insurance and as insurance intermediaries in this market.

The Commission wants Brokers to be in the fore front of the marketing of the compulsory insurance covers as enacted in the 2016 Insurance Act.

Consequently, the Commission is in the process of opening offices in the provincial district headquarter towns of Bo, Makeni and Kenema. We would expect the support of the brokers at the events. Our intention is to bring the activities of the Commission closer to the public and to encourage public patronage of insurance business.

Today, the Commission is about to launch a new checklist for the renewal of broker’s license. I thought that we should all discuss it so that you clearly understand what is required of you. Moreover, I know that you also as major players in this market may have your own concerns. You are therefore equally invited to table them so that we can discuss and have a resolution of those concerns.

Secondly, the Commission will soon be launching Market Guidelines and Practice. Please therefore leave your email addresses so that we can forward a copy to each of you. We encourage you all to read those guidelines and Market Practice and try to monitor within your brokerages their outcomes.

Whilst the public perception of insurance is improving, the image of the insurance industry to the ordinary Sierra Leonean is still not very favorable. This unfortunately has not helped in the efforts to increase the patronage of insurance. Some reasons attributed to this are, but not limited to; delayed and inadequate claims payment, insurance intermediaries, that is, brokers and agents’ inability to explain policy terms and conditions to the satisfaction of a potential policyholder, the use of insurance jargons in policies and statements.

The Guidelines and Market Practice therefore outline how the Commission aims to achieve our vision for a fair, strong and efficient industry, in other words, a trusted insurance industry.

The Guidelines represent the most significant ways in which the Commission will be addressing consumer complaints, punishing wrong doing, and encouraging better culture and behavior, including a greater emphasis on fairness and professionalism – throughout the industry.

Finally, I wish to say a few words about the issue of the statutory deposits paid into the Central Bank, the Bank of Sierra Leone by brokers. The amount involved currently is on the low side. The Commission therefore plans to announce new Statutory Deposit requirements during this year. Appropriate consultations on the modalities and transitional arrangements will be held with relevant stakeholders in due course.

I wish to thank you all again for honoring my invitation to this meeting. Please feel free to table issues that will help us to grow your business and this market.

I wish to thank you all again.