Category: Insurance

Large insurers continue to insure and invest in projects related to the extraction and burning of fossil fuels, contributing to the main cause of global warming.

Senior Energy Finance Campaigner with Rainforest Action Network (RAN), Elana Sulakshana, explained: “There’s a massive gap between words and action – and the Net Zero Insurance Alliance does not appear to be stepping into bold leadership to close that gap.

“This is why we need insurance industry regulators to step in and safeguard the public good.”

Although 32 insurers have made commitments to achieve net zero greenhouse gas emissions as members of the Net Zero Insurance Alliance (NZIA), none have committed to phasing out fossil fuel underwriting in line with plans to prevent a global temperature rise of more than 1.5C.

As our briefing highlighted, we cannot rely on insurers’ voluntary initiatives. Now is the time to include crucial sustainability measures in the Solvency II Directive.

“The latest UN climate report delivers a ‘final warning’ to humanity about the impact of climate change, but the insurance industry is still funding and underwriting fossil fuel companies. Policymakers need to step in.’’

” Better regulation of the insurance industry is needed to protect our planet and its people and to safeguard the industry itself.A s losses related to climate change are expected to increase we need stronger insurance companies – and that means safer levels of capital requirements.

“Higher capital requirements for fossil fuel investments would also make these investments more expensive, pushing insurers to divert and divest from these sector – with a positive environmental effect for us all.N o matter how technical the topic of ‘capital requirements’ sounds, it boils down to a clear political question – do we want more, or less, burning of fossil fuels?

“The European parliament is in the middle of heated negotiations to review the EU insurance legislation Solvency II. The EU supervisor for insurers and pension funds has been consulting stakeholders, in view of recommending changes to insurers’ capital requirements to take climate risk into account.

Sanlam Pan Africa (SPA)  has inducted Valentine Ojumah into its Council of Elders.

In a statement, the Senior Marketing Services Coordinator Sanlam Life Insurance Nigeria Limited, Bankole Banjo, said SPA is the business cluster for Sanlam Group’s operations in Africa, including Sanlam Nigeria.

Ojumah, who is one of two first-ever inductees into the council, is the pioneer Managing Director/Chief Executive Officer of the Sanlam Life Nigeria until he retired last year.

With over 35 years’ experience in risk management, insurance broking, consultancy and training within the  industry, academics and research, Ojumah served Sanlam Nigeria for 12 years.

Sanlam Pan Africa Life Chief Executive, Robert Dommisse said: “On behalf the SPA Life team, I am delighted to acknowledge Val as an inductee of the council.

“He is a visionary and exemplary leader, who has led the business with verve and conviction since inception. True to his innovative leadership, Val has been awarded some top awards during his career at Sanlam. Most recently, these included: SPA Life CEO Award (2021), AfricaRe, CEO of the year in Africa (2020), Sanlam Group Chief Executive Officer award (2016).

“As Val moves to enjoy the next chapter in his life, we are thrilled that he has accepted to serve on the SPA Life Council of Elders. We look forward to having the benefit of learning from his extensive leadership experience and fountain of knowledge to tackle challenges and opportunities for our business in the future.”

The Managing Director/Chief Executive Officer, Sanlam Life Insurance Nigeria Limited,Tunde Mimiko, congratulated Ojumah and commended his multi-disciplinary experience in building Sanlam Nigeria from inception into a successful business.

The Managing Director/Chief Executive Officer, Sanlam General Insurance, a subsidiary of Sanlam Life Insurance, Bode Opadokun, also lauded the industry legend, saying: “We are proud of you and look forward to many more years of contribution to the organisation as a member of the Council of Elders.”

Ojumah urged  for the growth and development of the organisation.

   Agents are gradually taking over the underwriting space through retail practice which has placed them top in life business premium drive

This is despite the challenges confronting them.

According to data obtained from the latest edition of the Nigeria Insurance Digest 2020, published by the Nigerian Insurers Association (NIA), agents controlled life business with N141.39 billion premium generated in 2020.

National President, Association of Registered Insurance Agents of Nigeria (ARIAN) Odewunmi Olakunle told reporters that the feat was achieved through personal sales of insurance, adding that the agents were working to also take control of the non-life business.

For their efforts, insurance brokers, agents and others earned N97.07 billion commission from underwriters and reinsurers in 2020.

Available data revealed that non-life insurers, paid N37.97 billion commission, life operators, N52.97 billion, takaful providers, N239 billion and reinsurers, N5.85 billion.

Insurance agents generated N164.08 billion, of the industries N508. 4 billion 2020 gross premium written, representing 32 per cent; brokers, N281.08 billion, which is 55 per cent; direct sales yielded N42.95 billion indicating nine per cent; banassurance N4.69 billion, one per cent; e-channel, N3.77 billion, one per cent and others, N11.86 billion, two per cent.

According to the NIA, out of the industry’s N508.44 billion GPW, N388.03 billion was generated from Lagos State.

NIA noted that while Lagos provided the highest premium for the sector, Yobe State gave the lowest amount of N17.78 million.

The Federal Capital Territory (FCT) came second with N48.08 billion followed by Rivers State with N21.98 billion.

Oyo State provided N7.83 billion, Delta State, N5.23 billion, Kaduna State, N5.17 billion and Edo State N4.16 billion.

In terms of claims, Lagos got, N177.54 billion, FCT, N17.36 billion and Rivers, N6.52 billion.

An analysis of GPW contributions by region showed that Southwest provided N402.32 billion; Northcentral N52.57 billion; Southsouth, N33.49 billion; Northwest N9.71 billion, Southeast N9.62 billion and Northeast N721.72 million.

On claims, Southwest got N182.94 billion, Northcentral N18.78 billion; Southsouth N10.21 billion; Southeast N4.10 billion; Northwest N3.17 billion and Northeast N374.79 million.

The Chairman, NIA, Mr Ganiyu Musa, said despite the huge challenges in 2020, the industry witnessed growth in its premium written as figures rose marginally by 3.6 per cent from N490.8 billion to N508.4 billion.

•Frown at liquidation of firms

Shareholders have commended the National Insurance Commission (NAICOM) for reviving International Energy Insurance (IEI) Plc.

The National Coordinator, Independent Shareholders Association of Nigeria (ISAN), Moses Igbrude, spoke with some reporters in Lagos.

He said they were excited that IEI was back and stronger.

He said for restoring the company, the commission has saved the jobs of the firm’s employees; save investors’ investments, protect policyholders and also impacts the economy, as it would continue to pay taxes.

He noted that shareholders were grateful to NAICOM for bringing back the underwriting firm, stressing that with the restoration, NAICOM has proved that it is not interested in the dearth of any company.

He commended NAICOM for appointing a board to manage the firm during the crisis and for allowing a genuine investor to take over the firm.

Igbrude noted that shareholders were against regulators for liquidating enterprises, adding that liquidation rob the economy of taxes, jobs, good investments and policyholders, their finances.

He implored NAICOM to apply the same efforts used in reviving IEI to save other firms that are not doing well.

He submitted that shareholders would continue to support NAICOM to ensure insurance firms live up to their responsibilities.

Igbrude went further to described as pathetic the foreign acquisition of insurance companies.

He expressed worry over the development, stating that most foreigners only take advantage of the nation’s bad economy, undervalued stocks and the poor exchange rate.

He said: “Our economy is so bad that most of our stocks are undervalued, our exchange rate is so poor, only a million dollar will translate to N700 million, then if you have N700 million, in this industry, you can buy and have a stake in insurance companies.

“The commission should know that not all Direct Foreign Investment (DFI) is good for the  economy. Some of the portfolio investors come to take advantage of the weak laws and economy. What they do is buy into firms and delist them from Nigeria Exchange and they become private business and, then, hid them from the eyes of the government and the next thing, you wouldn’t hear about the companies again,” he said.

Acknowledging that there were still good investors, he appealed to the NAICOM to allow only genuine investors into the industry. He urged the commission to put in place a process to check the fake ones.

AIICO Insurance Plc, Leadway Assurance Limited, Custodian and Allied Insurance are the top three indigenous insurance companies that made it to the Top 100 insurance companies in Africa in 2021, a report has shown.

The report released by Atlas Magazine and obtained by The Nation shows that Axa Mansard Insurance Plc and Mutual Benefit Assurance as among the Top Five companies in Nigeria that made it to the Top 100 in Africa.

This was followed by NEM Insurance Plc, which made it as top five companies in the category under review.

AN analysis of the report showed that AIICO made it into the top 50 insurance companies in Africa as it stood at number 46 on the list.

Similarly, Leadway emerges as number 48, Custodian and Allied 49, Axa Mansard 52, Mutual Benefit 91 and NEM 96.

It is worthy of note that the Top Five insurance companies in Africa are from South Africa with Sanlam as number one; Old Mutual Life as number two; Liberty as number three; Santam as number four and MML Group Limited as number five.

Meanwhile, the top category, Wafa Assurance of Morocco emerge as number six; Guardrisk Insurance of South Africa as number seven; RMA of Morocco as number eight; The Hollard Insurance of South Africa as number nine; and Old Mutual Insure of South Africa as number 10.

The companies ranking was evaluated based on 2020 and 2021 turnover in local currency.

Insurance companies have increased their claims payout to insured clients.
The Nation learnt that 93 percent of the claims by life insurance owners was fully paid by the insurance companies in last quarter of 2022.
The Head, Corporate Communications and Market Development of the National Insurance Commission (NAICOM), Mr. Rasak Salami, confirmed that “the percentage of claims paid to total claims reported stood at 93 percent in the Life insurance business”.
He noted that “despite operational challenges, the claims settlement experience of Insurers is improving”.
The difficulty in getting claims settled on time in the past has been identified as being responsible for the low interest in taking up insurance cover by many Nigerians.
NAICOM had said that “Insurance claims reported during the fourth quarter of 2022 stood at N318.2billion, representing 31.2 per cent QoQ growth.
The insurance regulator attributed the growing percentage in claims settlement to “growing awareness and market expansion as well as consumer’s confidence”.
In a similar pattern, the net claims paid in the fourth quarter of last year was put at N244.3billion, “growing at 17.9 per cent QoQ’’.

NAICOM had reported that “Non-life segment shows that Motor Insurance led with regards to claims settlement vis a vis gross claims reported at 92.3 percent.

Fire Insurance was the least at 46.3 percent, the only class below average proportion.

All other portfolios of, General Accident Insurance 80.7 percent; Oil and Gas 51.6 percent; Marine and Aviation 74.4 percent; miscellaneous Insurances 86.1 percent, all recorded a proportion above the average, of paid claims reported”.

Between 2017 and 2021 Dr. Umar Baba of NAICOM said “the insurance market has continued to grow in gross claims reported, reflective of the increasing policyholder enlightenment, market confidence from both demand and supply sides, and indeed effects of regulatory measures meant to ensure for claims settlement”.

He noted that “gross claims reported a fluctuation over the period to peak at a growth proportion of 36.2 percent over the years representing N336.8 billion in 2021 from N186.4 billion in 2017”.

He also attributed the percentage increase in net claims paid “to improved market discipline and the approach of customer focused regulation”.

The Commissioner for Insurance Mr. Oludare Sunday Thomas had insisted that “the Commission will continue to support the insurance industry and specifically the operators/players to thrive by instituting policies that encourage equal access, investment of funds and healthy competition.

To actualize the Commission’s core mandate, he said NAICOM will “facilitate improved perception of the insurance industry, as public confidence in our industry depends among other things on how promptly and fairly we deliver on our promises and obligations to our customers and stakeholders”.

Dr. Umar Baba also emphasized that “claims is a primary factor for the quest of insurance business and a cardinal element in its business model. Normally, Policyholders go for these services with the intent of filing for claims if/when the risk crystallises”.