Protectionism and Liberalisation in the Nigerian Insurance Sector: A Critical Examination of the role of Multinational Insurance Programmes in Dealing with Protectionist Trade Barriers

Ibrahim, Audu Samuel (2019) Protectionism and Liberalisation in the Nigerian Insurance Sector: A Critical Examination of the role of Multinational Insurance Programmes in Dealing with Protectionist Trade Barriers. Doctoral thesis, University of Buckingham.

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Abstract

This thesis critically examines protectionism in the Nigerian Insurance Sector and discusses it in the context of both the liberalisation efforts of the World Trade Organization (WTO) and the anti-protectionist measures that are inherent in a multinational insurance programme. Chapter one introduces the work and provides insights into the background, aims and objectives of the research. The Chapter also identifies the key research questions to be answered by the work and further discusses the key concepts relevant to multinational insurance programmes. Chapter two critically analyses the global anti-protectionist legal framework for the insurance sector enshrined in the WTO General Agreement for Trade in Services (GATS). It proceeds to analyse the Nigerian insurance regulations and closely examines the extent to which they comply with or diverge from Nigeria’s GATS obligations. This Chapter briefly discusses the insurance legal framework in the United Kingdom and comparatively identifies approaches that can be adopted and lessons Nigeria should learn from the UK. Despite the identified positives from the UK regulatory framework, Chapter two points out that the GATS liberalisation efforts have been highly inadequate and ineffective in resolving the insurance sector protectionism that characterises many jurisdictions including Nigeria. It therefore identifies multinational insurance programmes as a private sector driven solution to this problem and noted that the WTO approach and any other inter-governmental approach may not yield an immediate solution to this problem. Chapter three essentially assesses the internal and external workings and operation of Multinational Insurance Programmes. The Chapter introduces and extensively discusses the Multinational Insurance Programme as a special type of insurance and argues that it was invented as a result of globalisation and it exists in two major forms – admitted and non-admitted cover. It then critically analyses the solutions and drawbacks inherent in both an admitted and non-admitted insurance cover. Finally, the chapter discusses the various forms of non-admitted cover including the design and structure of a controlled master policy. Chapter four acknowledges the fact that the adoption of Multinational Insurance Programme helps to address the problem of protectionism, but it raises an additional issue of the legality of its adoption in the context of Nigerian law and under the laws of other non-admitted jurisdictions. The chapter therefore addresses this issue and discusses instances where severe regulatory sanctions had been imposed for usage of this form of insurance. The chapter further discusses the response by experts to this legality challenge through the invention of circumventing tools or permissive options like cut-through clauses, financial interest clauses, fronting arrangements, among others. Chapter five recognises that apart from regulatory protectionism, state actors adopt fiscal measures in the form of taxation to protect a particular sector. The chapter proceeds with a critical analysis of the role of taxation as a protectionist tool in Nigeria and points out the widespread discrimination and unfair tax laws and policies that have stalled the growth of the insurance sector and affect both admitted and non-admitted insurers alike. The chapter queries the rationale for such laws and policies, especially in view of the fact that it discourages growth and investment in the insurance sector. The chapter contains solutions for each problem identified and recommends quick fix option for the implementation of some of these solutions. Chapter six of this thesis, summarises the work and concludes by making strong recommendations that can turn the fortunes of the Nigerian insurance sector through the adoption of more liberal laws and policies.

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