The Namibia Financial Institutions Supervisory Authority (NAMFISA) has called on insurers to strengthen governance and risk management systems to prepare for emerging threats such as artificial intelligence (AI), cybercrime and climate change under the Financial Institutions and Markets Act (FIMA).
NAMFISA General Manager for Insurance and Medical Aid Funds Erich Gariseb speaking during a Deloitte, said the new risk-based regulatory framework requires insurers to proactively identify and manage risks specific to their businesses, rather than relying solely on compliance with prescriptive regulations.
He said the rapidly evolving financial services landscape means legislation cannot be amended every time a new risk emerges.
“The financial landscape is constantly evolving. Whether it is artificial intelligence, digital distribution, cyber risk, climate risk or changing consumer expectations, legislation cannot be amended every time a new risk emerges. FIMA requires insurers to understand the risks that are specific to their business and demonstrate that they have appropriate governance, risk management and internal controls to manage those risks effectively,” Gariseb said.
He said the framework is intended to ensure insurers remain financially sound as interconnected risks become increasingly complex.
Gariseb warned that geopolitical tensions, inflationary pressures and higher interest rates continue to pose risks to insurers by affecting profitability, liquidity and solvency.
He urged insurers to strengthen enterprise risk management, improve board oversight of emerging risks, invest in specialist skills and embed risk management into strategic decision-making.
“The focus is no longer on simply complying with detailed rules but on ensuring that institutions remain financially sound, resilient and able to deliver fair outcomes for policyholders. Regulation and innovation should not be seen as competing objectives. A sound regulatory framework creates confidence in the market and supports sustainable innovation,” he said.
Meanwhile, NASRIA Legal, Governance and Compliance Officer Magarete van Niekerk cautioned insurers against treating FIMA compliance as a box-ticking exercise.
She said firms that fail to align their operational practices with the legislation remain exposed to conduct and operational risks despite having compliant policies on paper.
“Where organisations struggle is when compliance is treated as a paper exercise. Policies and frameworks refer to FIMA, but daily processes, systems and sales practices still follow old habits. On paper the insurer looks compliant, but in the market the same conduct and operational risks continue,” Van Niekerk said.
She said insurers should ensure governance, financial soundness and product oversight are fully aligned with FIMA to build more resilient institutions and strengthen policyholder protection.
