The Nation Newspaper

Category: Insurance

  • STI settles N944m claims in six months

    Sovereign Trust Insurance (STI) Plc said it has paid a total of N944.5 million as claims to its customers across the country in the last half of the year.

    The breakdown of the amount paid so far shows that N351million was settled as claims in the first quarter of the year while N593million was paid in the second quarter of the year.

    Managing Director fo the firm, Mr Wale Onaolapo, who disclosed this, said the claims portfolio of the firm in the first half of the year comprise energy claims settled at N401.6million.

    He said while motor insurance claims peaked at N218.4million, fire insurance claims got N83.8million. He said a total of N128.5million was settled as claims under the general accident insurance. Marine insurance claims amounted to N100.4million while engineering insurance claims totalled N11.7million.

    Onaolapo reiterated the commitment of the company to prompt claims settlement adding that it is the only way the company can generate more confidence from its customers and the insuring public at large.

    He said: “Whenever the need arises to settle claims, STI does not see it as doing the customer a favour, rather, we are concerned about making the customer delighted with our seamless claims process which ultimately will lead to customer satisfaction.

    “We are only fulfilling our part of the agreement made at the point of picking up the business that all genuine claims will be settled as and when due.”

  • Insurers record high cash flow, says NAICOM

    Commissioner for Insurance, National Insurance Comission (NAICOM), Mr. Fola Daniel has revealed that the on-going implementation of the ‘No premium, no cover’ law which started on January 1, this year has significantly improved the cash flow of insurance institutions in the country.

    The NAICOM boss gave this hint at thesensitisation workshop for stakeholders, in new Karu, Nasarawa State. A channel he said is expected to raise public awareness on the key initiatives of the commission aimed at further opening up the market, and by extension increasing the sector’s contributions to the Gross Domestic Product (GDP) of the nation.

    He said it is expected that this positive turn of events would impact on the capacity of operators to settle claims promptly, thus removing a major sore point in the relationship of insurance consumers and service providers.

    Daniel stressed that the commission had to implement the law on ‘No premium, no cover’ law in order to put a stop to the vexed issue of delayed or non-payment of insurance premium by the insured.

    Section 50 (1) of the Insurance Act 2003 stipulates that the receipt of an insurance premium shall be a condition precedent to a valid contract of insurance and there shall be no cover in respect of an insurance risk unless the premium is paid in advance.

    He explained that invariably, it presupposes that no insurance cover shall be granted by any insurance company without having received the premium.

    Daniel said the insurance sector has great potentials for massive growth.

    “You will agree with me that the population and size of the country, if adequately harnessed, give an added advantage to the insurance industry to further develop its market,” he said.

    He noted that the various initiatives put in place by the Commission in recent times were all geared towards turning round the fortunes of the sector.

    He said to ensure adequate understanding and build capacity among the stakeholders, NAICOM has resolved to conduct a series of workshops and seminars for stakeholders adding that the sensitisation programme in Nasarawa was among the workshops and seminars earmarked to inform and educate stakeholders towards the attainment of mutually beneficial relationship between organisations.

    “The insurance industry has witnessed tremendous changes in recent times owing to the new reforms embarked upon by NAICOM.

    “These reforms include the introduction of Risk Based Supervision, migration to International Financial Reporting Standard (IFRS) from the Nigerian Generally Accepted Accounting Principles (NGAAP); Market Conduct Reforms, Claims Settlement Reforms, Financial Inclusion and others, all geared towards developing the industry and improving the general perception about insurance.”

    According to him, these reforms were in line with government’s Vision 20:2020 of deepening insurance penetration to become the insurance industry of choice among the emerging markets in terms of capacity, safety, transparency and efficiency.

  • Hurricane states not doing enough to improve codes

    Hurricane states not doing enough to improve codes

    Hurricane prone states with weak building codes have done nothing in the last 18 months to improve their codes and are falling further behind on best building practices, according to the latest update to the Insurance Institute for Business & Home Safety’s “Rating the States Report.”

    According to insure.com, the update looks whether the 18 states along the Gulf of Mexico and Atlantic coasts have improved their building codes since the last report in January 2012.

    The institute found that most of the states with strong building rules in 2012 have updated to the most recent model building codes, while the states with low scores in the original report have done nothing to improve their codes.

    The institute plans to issue a new report in 2015, which will revise the rating for each state based on actions taken since the original report. The January 2012 report scored states on a 100-point scale on the strength of their building codes and enforcement.

    States that acted to improve their codes in the last 18 months, along with their original scores: Florida (95); Virginia (95); South Carolina (84); Connecticut (81); Rhode Island (78); Maryland (73); Georgia (66); New York (60); and Alabama (18).

    Building codes are intended to increase the safety and integrity of structures, thereby reducing deaths, injuries and property damage from hurricanes and other hazards.

  • IGI, Mutual Benefits, others yet to submit annual accounts

    About six months after 2012 financial year ended and three months after the June 30 deadline given insurers for the submission of annual accounts, some insurance giants in the industry are yet to submit their International Financial Reporting Standard (IFRS) accounts to the National Insurance Commission (NAICOM).

    According to the 2012 financial statements submission status of insurance companies byNAICOM as at August 27th, 2013, out of the existing 57 insurance companies and two re-insurance companies, 31 companies submitted their accounts out of which only nine got approval.

    Veteran insurers like Industrial and General Insurance Plc (IGI), Royal Exchange Insurance Plc, NICON Insurance, Niger Insurance, Goldlink Insurance Plc, Mutual Benefit,Cornerstone, International Energy InsurancePlc (IEI), make the list of companies that are yet to submit their report.

    Others are Union Assurance, African Alliance Insurance Plc, Alliance and General Life Assurance Plc, Capital Express, LASACO Life, Mutual Benefit Life, Anchor Insurance, Great Nigeria Insurance, Guinea Insurance, Linkage Assurance, Oasis Insurance, Staco Insurance, Standard Alliance Insurance, Universal Insurance Plc and Unic Insurance.

    Out of this group, IEI, Cornerstone, Niger, Oasis, Staco, Standard Alliance and Universal Insurance are quoted on the floor of the Nigerian Stock Exchange (NSE) and risk suspension by the exchange.

    Section 26 of the Insurance Act, 2003 states that failure to file annual returns constitutes a ground for cancellation of operating license and an insurer shall be deemed to have failed to file its annual returns if the provisions of Section 26 of the Act are not met 12 months after the end of the financial year.

    The nine companies that got NAICOM’s approval are Mansad Insurance Plc, ADIC Insurance Ltd, WAPIC Insurance, Consolidated Hallmark Insurance, Oasis Insurance Plc, FBN Life Assurance Ltd, Continental Reinsurance Company Plc, AIICO Insurance Plc and Leadway Assurance Company Ltd.

    Others like Custodian & Allied Ins. Plc, Unitrust Insurance Company Limited, Crusader General Ins. Ltd, UBA Metropolitan Life Ins. Company, NEM Insurance Plc, Law Union & Rock Insurance Company, Zenith General Insurance Ltd, Zenith Life Insurance Ltd, Standard Allied Life Assurance, Crystal Life Insurance, Sovereign Trust Insurance Plc, FIN Insurance Ltd, Unity Kapital Assurance Plc, Equity Assurance Plc, Lasaco Assuarnce Plc, Prestige Assurance Plc, PHB Insurance Plc, Regency Alliance Company have submitted their annual accounts but are being queried at different levels by the regulator.

    At a parley with all the CEOs of insurers in Ibadan, the Commissioner for Insurance, Mr. Fola Daniel, expressed concerns over the delays in the submission of 2012 annual accounts and common errors noticed in the reports already submitted by some insurance companies.

    At the meeting which was held behind closed doors, Daniel stressed the need to speed up the process to avoid further delays in the approval of accounts by the commission and warned of grave consequences of further delays of submission and approval of the accounts to the affected companies.

    The Nation learnt that the commissioner who did not hide his disappointment over the development said the commission will not hesitate to wield the big stick when necessary.

    Meanwhile before the meeting with the CEOs, NAICOM also held a meeting with Chief Financial Officers (CFOs) of the affected insurance companies where they accepted there were challenges but promised to do the needful.

    The meeting was addressed by NAICOM Deputy Commissioner, Finance and Admin, George Onekhena and Director, Supervision, Nicholas Opara. The two officials also took time to address some areas of challenge to the companies.

    But in spite of these meetings, the companies are still struggling and are yet to submit.

    It was learnt that while some are having challenges in getting their auditors and actuaries perfect their accounts, others may have got their hands soiled with several irregularities and misstatement in the activities of their companies and are afraid of being exposed and sanctioned.

    One of the embattled CEOs who spoke on condition of anonymity said his company has not submitted because of the issues of IFRS.

    He said there are also challenges with external auditors as most of them have just changed their previous auditor as required by the law.

    “But as I am speaking with you now, our CFO is in Abuja ready to submit the account to NAICOM,“ he said.

    The managing director of one of the old insurance companies in the country explained that some of the big companies are having issues because of their size especially those who have branches in other African countries.

    There is also the challenge of information technology, he said.

    “For us, our challenge has to do with size. It is the first time we have to do a full blown financial result on IFRS.

    “We are also faced with the problem of lack of good actuaries in the country. It is a bigger problem for us because as a composite insurance company that operates general and life businesses, we are required by the IFRS standard to produce two actuarial valuations for the two businesses. Before now, we were only required to do valuation for general business.

    “The number of actuarial firms in the country is too small and it is a big challenge. Although the actuarial scientists in Nigeria are coming up with initiatives to develop that part of our business need, we are going to set up our own actuary in the company.“

    An industry observer said it is worrisome that these companies have not submitted their account and had not got approval from the regulator.

    He however urged NAICOM not to relent in enforcement of laws guiding the industry as this will bring out the true state of the industry and investors will be guided appropriately.

  • Public buildings: Lagos, NIA collaborate

    The Nigeria Insurers Association (NIA) has said it is collaborating with the Lagos State Government Building Control Agency on a proposal to enforce the provision of Part 111 section 48 of the Urban and Regional Planning and Development Law No. 3 of 2010 Laws of Lagos State.

    According to NIA, this is in line with the state domestication of Sections 64 & 65 of the Insurance Act 2003.

    Director-General, NIA, Mr. Sunday Thomas said Lagos State and the association will mount an enlightenment campaign to sensitise the public before the commencement of enforcement.

    He stated that it is expected that this will improve members businesses’ in these classes of business and also deliver the benefit of insurance to the people of Lagos State.

    He further disclosed that the representatives of the governing council led by Professor Joe Irukwu, (SAN) met the representative of the International Monetary Fund (IMF), Dr. Rodoyo Wenrhan to explore the potentials of the insurance industry as an economic growth driver in Nigeria.

    He said the objectives of the mission was to ensure stability is sustained within the system.

    He said the IMF stated the outcome of the meeting is expected to be published with recommendations made on how to move the industry forward.

  • Africa Re gets N1.9b lifeline

    Africa Re gets N1.9b lifeline

    • Earns $647m income

    African Reinsurance Corporation (Africa Re) owners have injected over N1.9 billion into the company, representing a 96 per cent subscription.

    The offer, which started in 2010 has been extended to 2014 to allow more time for members to take their rights.

    TRhe company’s Chairman, Musa S. El Nass, who spoke at its 35th Annual General Meeting (AGM) in Senegal, said the subscription and payment of shares issued by the corporation in 2010 continued with remarkable result last year.

    The extension, he said, was between June 1, 2013 and May 31, 2014 and places offer price at $234 for regional shareholders, and $225.57 and $279.17 for non-regional shareholders according to two valuations.

    He expressed delight that the shareholders demonstrated their confidence in the corporation and its future with more than 96 per cent subscription of new shares offered representing an additional capital of $150 million”

    He said: “As contained in the resolution of the General Assembly, members were delighted with the confidence that the majority of existing shareholders including states, development finance institutions, and insurance and reinsurance companies bestowed on Africa Re by subscribing in the new shares.

    “They also commended the keen interest shown by African States and Companies and encouraged them to steer a steady course to preserve the African character of the corporation.

    “Accordingly, the General Assembly authorised that the fourth capital increase be kept open to allow traditional shareholders who are facing difficult times to subscribe and pay.

    “The General Assembly further authorised that the capital structure slightly differs from the related provision of the agreement establishing the corporation while trying to find ways of returning to the ideal structure of 40 per cent for African Development Banks; 35 per cent for Insurance/Reinsurance Companies and 25 per cent for non-regional shareholderers,” he said.

    The corporation made an income of $647.98 million at the end of 2012 Financial year as against $631‘.49 million recorded in 2011, a 2.6 per cent increase while the net profit stood at $92.65 million compared to $69.20 million the previous year, he added.

     

     

     

     

     

  • Equity Assurance pays N556m claims

    Equity Assurance pays N556m claims

    Equity Assurance Plc said it has paid over N556 million as claims for policyholders between January and August, this year.

    Giving breakdown of the payment, the firm explained that fire claim had the highest figure of N198,759,849.28 followed by motor insurance N189,581,860.86.

    General accident claim amounted to N90,565,467.92 while marine claim was N44,874,679.94. Claims from Oil & Gas was N24,372,069.87. Engineering had the least with N8,447,518.50 claims.

    Managing Director of the underwriting firm, Dr. Ekpe Ukpabio said the company has lived up to its responsibility to its customers. He added that it reflected the financial strength of the company and the ablity to stand by its policyholders in their time of need.

    According to him, the company has an uncompromising stand towards claims settlement adding that a customer-friendly claim process is in place to ensure timely settlement of claims with the interest of customers in mind.

    This he said is in line with its core values, promptness and excellent customer service.

  • ‘12 operators enough for insurance’

    ‘12 operators enough for insurance’

    President, Institute of Loss Adjusters of Nigeria (ILAN), Lebi Omoboyowa, has said the country does not need more than 12 insurance companies going by the poor performance of some of them.

    Omoboyowa spoke with The Nation at the institute’s Annual General Meeting (AGM) in Lagos.

    He said the N300billion premium income generated by the insurance industry since 2007 till date can be improved upon if NAICOM reduces the number of insurance companies in the country.

    According to him, the industry would thrive if there are few companies that are strong.

    He further said instead of insurers’ spending money on insurance awareness campaign, they should itemise their claim settlement to boost awareness.

    Speaking on the institute’s charter, Omoboyowa said it would soon be accomplished, adding that a bill on it is with the House of Representatives.

    On fees payment, he said: “We are not happy with fees paid to us by insurers and we have been discussing with them. We have also visited the Nigeria Insurers Association (NIA).

    “Although the council members have indicated their willingness to consider a review of the fee scale as soon as the Insurance Act 2003 is being implemented and yielding positive results, we are hopeful that loss adjuster business will get better in the country.

    “The International Federation of Adjusting Associations (IFAA) has made provisions for Associate membership with the existing fellow membership and this will enable ILAN associate member to apply through the institute to become an associate of the world adjusting body.”

  • Niger Insurance introduces Cash Plan policy

    Niger Insurance Plc has introduced Niger Cash Plan into the market to encourage people to plan.

    Managing Director of Niger Insurance, Kola Adedeji, explained that rather than just catering for people after they might have suffered misfortune, he believes people should be given the opportunity to project a financial earning for the future, while at the same time getting insurance value for them and their dependants.

    According to him, the new policy is designed to provide the holder with income in the form of cash payments at regular intervals, as well as cash benefits for protecting the holder or the family in the natural course of events like disability and accidental death.

    He said the plan, by virtue of its special structure, is an ideal policy for a progressive young persons.

    He said: “While the premium payable by the policyholder is competitive, the benefits are sufficiently attractive and among them are: regular cash payments on survival; lump sum cash payments at death, family protection; accidental death benefit; waiver or premium disability benefits and guaranteed insurance option.

    “The company is constantly striving to be more responsive to the needs and yearnings of customers in realisation of the fact that the organisation is primarily in business to satisfy its esteemed customers.” The company said it has also reviewed its information communication technology (ICT) application to business.

    “We are also working on other traditional products to make them more user-friendly because our focus now is on the customers. What we are trying to do is for them to always come back to make repeat purchase; we want to have satisfied customers, because here, the customer is king.”

     

     

     

     

     

  • Insurers blame FIRS for excessive taxation

    Insurance operators have cried out over excessive taxation they are being forced to pay by the Federal Inland Revenue Services (FIRS), lamenting that the development was crippling the insurance business.

    The Nigeria Insurance Association (NIA) said FIRS imposes heavy taxes on premiums paid by the public, forgetting that when the unforseen happens, the insurance companies would pay claims.

    Spokesman of the association, Mr Davies Iyasere told The Nation that officials of the FIRS are ignorant of how insurance business operates.

    “Our claims are that they do not understand fully how insurance works. The tax they are charging insurance operators is (too) heavy. They tax all premiums we receive not minding the fact that we have to pay claim.

    “We have to invest the money paid as premium so that we can pay claims. Sometimes the claim occurs immediately or in the future. We have to make valuation and projections for 10 years and this is why we are saying they cannot tax on every premium collected. They are looking at premium and not claim and we believe this is not fair on insurers. We have reached the Inland Revenue and the channel of communication has been opened,” he added.

    To find solution to the problem, he said the NIA and the National Insurance Commission (NAICOM), the supervisory authority, are engaging the FIRS, adding that the association has also been speaking with the Consumer Protection Unit (CPU).

    He lamented that no progress has been made on finding solution to the problem.