The Nation Newspaper

Category: Insurance

  • Wapic unveils campaign on road safety

    Disturbed by the high rate of accidents, Wapic Insurance Plc has kicked off a campaign aimed at restoring discipline on our roads.

    In a statement, the company’s Managing Director, Mrs Adeyinka Adekoya, said the campaign, tagged “Road Sense” is a three-month long advocacy aimed at encouraging and entrenching safe-road use culture in Nigerians.

    Specifically, the digital instructive awareness drive is expected to promote knowledge of the road signs and encourage the various categories of road users to respect the meanings of the signs on  the roads, she said.

    She reiterated that the programme is an attitudinal-change online campaign to promote safety on roads.

    She said: “The initiative is sequel to the highly successful “Safety-on-Wheels” campaign executed by Wapic in partnership with some notable government and security agencies, including the Nigeria Police Force (NPF), Federal Road Safety Corps (FRSC) and Lagos State Transport Management Authority (LASTMA) in February. Unlike the Safety-On-Wheels campaign, which enlightened over 1000 drivers about safe road-use practices, importance of adherence to road traffic regulations and appropriate road as well as vehicle maintenance cultures, “Road-Sense” seeks to reach a broader audience across the different demographics.

    “Many road users do not really know the rules of the road or understand the signs. This results in bad driving habits as well as inappropriate road-use culture that cause accidents. Wapic is a vociferous advocate of proactive risk avoidance. The underwriting firm, which boasts an enviable record of claims payment, is a prime promoter of initiatives that empower people with relevant knowledge and apposite skills that reduce road accidents in Nigeria.

    “As a socially responsible corporate citizen with focus on health, education, social empowerment and environment, Wapic is nationally and internationally acknowledged for its defining roles and social interventions that have consistently enhanced the quality of living and humanity. Through its numerous interventions, the company is committed to driving social progression and instituting safe-road use culture in Nigerians, by ensuring that motorists, passengers and pedestrians have adequate knowledge about road-use commandments that guide traffic interactions.’’

  • Linkage gets NAICOM’s approval to underwrite agric

    Underwriting firm, Linkage Assurance Plc has secured the approval of the National Insurance Commission (NAICOM) to underwrite agric insurance in the country.

    A statement made available to journalists stated that the ‘no objection’ nod will enable Linkage support the farmers and service providers in the agricultural value chain for greater sustainability and economic growth.

    It read: “Among the products approved include Linkage Assurance Crop Insurance Solutions; Linkage Assurance Farm All Risk lnsurance; Linkage Assurance Farm Motor lnsurance; and Linkage Assurance Livestock lnsurance solutions. Linkage management in a statement made available to journalist said the Nigeria’s agribusiness sector needs insurance to remain sustainable and achieve long term growth expectation.

    “Stakeholders in the agricultural value chain need to embrace insurance by reducing retained risk and transferring the burden to insurers for effective risk management. With this approval, we are positioned to broaden its product offerings to consumers, which is in line with the federal government objective to deepen insurance penetration in Nigeria. Also by this development, it is strategically accelerating its business objective of building a dominant company in the insurance industry.

    “Linkage Assurance Crop Insurance Solutions provides cover against unavoidable loss of crops or resulting directly from the insured perils, example flood, drought, excessive rains, hailstorm, diseases and pest, with covers including Weather lndex Crop Insurance; Area Yield – lndex Crop lnsurance and Multi-peril crop insurance.

    The Linkage Assurance Farm All Risk lnsurance is designed to cover the farm buildings/contents, farm products and machineries against theft and fire. It also provides cover on general accident for farm staff and farmer’s legal liability.

    “While, Linkage Farm Motor insurance protects the insured for loss of or damage to vehicles used in the farm or agricultural business, damage to Third Party property including bodily injury and death to third parties caused by accident.

  • Efekoha to focus on human resources, professionalism

    The quality and quantity of our human resources and professionalism are major issues we must continue to address in order to keep the insurance industry relevant, the newly elected President and Chairman of Council, Chartered Insurance Institute of Nigeria (CIIN), Eddie Efekoha has said.

    Efekoha who made this known in his acceptance speech during the investiture ceremony held in Lagos.

    He disclosed that in advancing insurance education and professionalism, he will embark on projects such as Infrastructural Development at the College of Insurance, Advancing Insurance Education and Professional Development.

    He said the Institute is conscious of its statutory role as the educational arm of the industry.

    He stated that this guided him to arrive at the theme of his presidency, make “Advancing Insurance Education and Professionalism”, which will focus on education and professional development.

    He noted that the programmes to be executed under this theme have been carefully selected while being guided by the doctrine of continuity which was institutionalized by a past President, Bola Temowo.

    He added that this entails concluding on-going positive projects and policies by successive leaderships in addition to embarking on new projects and plans.

  • Recapitalisation: investor proposes 10-year roadmap

    An investor has proposed a 10-year recapitalisation roadmap that would enable life insurance companies raise their capital to N20 billion; general operators, N30 billion and composite firms, N50 billion.

    Lancelot Ventures Limited Managing Director, Adebayo Adeleke, who is also a shareholder in many insurance firms, said this at the third National Conference of the National Association of Insurance and Pension Correspondents (NAIPCO) in Lagos.

    He added that three-tier recapitalisation roadmap should be clearly thought out and spanned over 10 years.

    According to him, the first phase of recapitalisation should be within a period of 18 months and Life underwriters should raise their capital from N2billion to N4billion and General Business Operators move from N3billion to N5billion.

    He said in the second phase, which should be three years after the first exercise, Life operators should move their capital to N8billion; non-life, N10billion and composite, N18billion.

    He maintained that in the third phase, which should be five years  after the second recapitalisation exercise, Life underwriters should beef-up their capital to N20billion, General Business underwriters, N30 billion and composite firms, N50 billion.

    He called on the National Insurance Commission (NAICOM) to evolve templates and incentives for mergers and acquisitions to enable strong firms absolve weak ones, as against waiting for firms to be bankrupt, and then take over the management.

    In a similar vein, Past President, Chartered Insurance Institute of Nigeria (CIIN), Bala Zakariya’u, has urged regulators in the financial services industry to create the enabling environment for mega  companies to be established through mergers and acquisitions, adding that “such mega financial institutions are to be tasked with higher capital and solvency, sophisticated information technology infrastructure, best in class human resources and strong brand presence.

    Zakariya’u further said the mega institutions should also have better all-round capacities and connections, as well as cognate strategies to deepen market penetration and enhance finance inclusion.

    While fears may be expressed that creating mega institutions may lead to the emergence of ‘companies, which may be too big to fail and is every regulator’s nightmare, he believed ‘this ought to be a preferred nightmare, than what we currently have by default: companies, which are too small to succeed.’

  • Leadway promotes Nigerian Art at Sao, Muse

    In line with its commitment to promote the creative energy of African artists to strengthen the growth of the art industry, Leadway Assurance has announced its partnership with Sao Café for this year’s edition of contemporary art exhibition.

    The exhibition tagged: ‘Sao and the Muse 3’ with theme: “Collaboration era”, would explore the power of coming together to solve problems, breaking the traditional rules of art by creating an unlikely collaboration of artists with diverse media to create out of the box art.

    Speaking on the partnership, Head Corporate Services, Olubunmi Adeleye, said the partnership with Sao Café for Sao and the Muse 3, will further promote the celebration and empowerment of emerging art talents across Nigeria.

    She said it is also a vehicle to showcase Leadway’s bespoke Art  insurance cover and give guests, collectors and art enthusiasts the opportunity to interact with and create useful conversations about the product and the cover it offers.

    She said: “The event, which  held at  Sao Café in Lagos, drew  the attention  of artists and art enthusiasts since 2016, featuring a unique multi-media exhibition that celebrates art in  its many forms, enabling guests to connect, create and learn about art and music.

    “Leadway’s will continue to support the celebration and protection of the creative arts in Nigeria. We are delighted to be a part of the laudable and exemplary initiative targeted at promoting the vibrant creativity of Nigeria’s art community.”

    We understand the importance and the place of creativity in nation building and its role in upscaling the development of the minds of young adults, hence, our support for an event that will promote ingenuity whilst enabling the emergence of budding talents.”

  • Leadway supports new capital regime, reclassification

    More firms will soon be finding their voice and position as Leadway Assurance steps forward to support the introduction of the solvency requirement for insurers from January 1, next year.

    This is coming on the heels of the announcement of Tier-Based Minimum Solvency Requirement (TBMSR) regime by the regulatory authority, the National Insurance Commission (NAICOM).

    The new TBMSR will reclassify firms into Tier 1, Tier 2 and Tier 3 and ensure that they insure only risks that are commensurate with their capital.

    The development is expected to grow  industry contribution to Gross Domestic Product (GDP) from 0.3 per cent and improve its ranking within the comity of African insurers.

    Since NAICOM’s announcement, insurance firms have been thrown off balance and are still grappling with its after shock. The development has upset some firms that thought they may be extinguished form the industry.

    But two weeks after the announcement, one of the leading insurance companies, Leadway Assurance Company Limited commended the regulators for a policy, saying it is long overdue.

    Its Managing Director, Oye Hassan-Odukale, who gave the commendation following FBNInsurance Limited Managing Director, Val Ojumah’s description of some operators as fringe players while supporting the regulatory order, said solvency requirement’s introduction would help restructure the market in a way that insurers could choose, which part of the consumer segment is best served, based on the capital fund it holds or is able to deploy.

    The Leadway chief is also the Sub-Committee Chairman on Publicity and Communication for  Insurers’ Committee.

    According to Hassan-Odukale, with the restructuring, insurers do not have to be compelled to increase their capital to underwrite risks that stress their capital without delivering commensurate returns to capital providers or shareholders.

    He said the restriction would foster the emergence of players with capacity to become retail or underwriters’ specialists in critical sectors of the economy, such as the aviation and oil and gas, while accelerating the growth of the industry and its contributions to the country’s Gross Domestic Product (GDP).

    Hassaan-Odukale also expressed his confidence in the initiative. “The news of NAICOM’s introduction of TBMSR is a positive one. I am confident that it is an initiative with potential upside for the industry to grow and take its rightful position as a formidable contributor to our national economic activities, growth and development as it is in developed economies.

    “It is high time we moved beyond the 0.3 per cent contribution to GDP and improve our ranking within the comity of African insurers (heavily dominated by South Africa) as measured by the African Insurance Barometer. Overall, we should expect an improvement in the capacity and reputation of the industry on the back of unwavering market discipline, improved claims settlement, stronger local retention, increased prudence and promotion of appropriate pricing,” he said.

    He continued: “Under the new TBMSR, the minimum capital requirement which is policyholders’ surplus/shareholders’ funds for insurance companies remains as the base Tier 3 capital (N3bn for General Insurance; N2bn for Life).  Tier 3 companies are now only able to write retail insurances (micro insurance, motor, fire, agriculture, compulsory liability insurances, individual life, health and miscellaneous insurance). Tier 2 companies are required to have 150 per cent of the base capital (N4.5 for General Insurance and N3billion for Life) based on the types of risks written. Tier 2 companies can write retail insurance as prescribed under Tier 1, including commercial and industrial risks and group life assurance.

    “Tier 1 companies are ultimately required to have 300 oper cent of the base capital (N9billion for General Insurance and N6billion for Life) to write all risks including annuity and exclusively Special Risks (e.g. energy and aviation risks) which are highly capital intensive in terms of risks retained on the balance sheet of the insurer in addition to any reinsurance capital purchased. Automatically, composite companies (Life and General Insurance) at any tier only need add both sides to make up the required capital, so you will have N5billion for Tier 3, N7.5billion for Tier 2 and N15billion for Tier 1.”

    On how the TBMSR will affect insurers’ solvency margin, Hassan-Odukale added:“It is important to note that all companies already fall within each restructured tier therefore, no company needs to raise additional capital unless they have existing capital deficiency or prefer to play within a tier above its current capital level.

    “Leadway Assurance, which falls within the Tier 1 bucket has shareholders’ funds valued in excess of N40 billion compared to N15 billion required for a Tier 1 composite insurer. A number of other insurers are also within this tier. We believe this TBMSR is good for our industry as it helps to promote the financial health of insurers and, ultimately, consumer confidence.

    “Insurers are already at different levels of the tiered system. Each company will then be placed within the bucket that they already belong. Should companies now decide to play at a level higher than their current tier, the shareholders can take capital actions either by mergers or injection of new funds. With the TBMSR, insurers simply play within the limit of their solvency capacity,” he said.

    Hassan-Odukale also said unlike the previous capitalisation, no insurer is being asked to shore up capital and neither will anyone’s licence be withdrawn either, stressing that companies simply get to choose which tier they want to operate in, ensuring that they stay within their capacity so that they are able to meet the obligations of the risks that they carry.

    “If a Tier 3 company then wants to play at Tier 1 level, nothing stops them from embracing voluntary merging with other companies in order to scale up their capacity and build more formidable and globally-competitive institutions that would create value for stakeholders and investors.

    “At the end, the major difference between the three tiers will be in the nature of risks underwritten by each insurer, depending on each insurer’s current capital position. To reiterate, the choice of whether to increase capital is left to the insurer who must decide within which tier it wants to play the market as the regulator has not required any company to increase capital above the current minimum,” he added.

    Meanwhile, NAICOM will today kick off a training session with Board members of all the companies. The Commission, which planned to transit to the new capital regime, is preparing the Board for smooth transition.

    Commissioner for Insurance, Mohammed Kari said the Commission said the training would create awareness for the Board and enable them make proper decision going forward. He said after the training, the Boards are expected to take a decision on their choice to either be a Tier 1, Tier 2 or Tier 3 player not later than September 14.

  • WAICA RE posts $62.1m premium

    WAICA Reinsurance Corporation has posted a 26 per cent growth in gross premium income from $49.2 million in 2016 financial year end to $62.1 million in 2017. WAICA Re is owned  by West African Insurance Companies Association (WAICA).

    ln its member countries, The Gambia recorded the highest level of growth of 30 per cent, followed by Nigeria 19 per cent and Ghana 15 per cent. Sadly, however, the Corporation recorded negative growth of 36 per cent and 8 per cent in Sierra Leone and Liberia respectively.

    Its Chairman, Kofi Duffuor while speaking at the  5th Annual General Meeting (AGM), which held in Nigeria for the first time since its existence, said they are working hard to improve on the performance in the coming years.

    He said in line with their strategic objective of growing the business beyond the Anglophone West Africa region, they attained a remarkable growth level in the Francophone Africa region in 2017.

    He stated that the French region grew by an impressive 34 per cent while earnings from other overseas countries also grew by 33 per cent.

    “Our Tunisia office, which started operations in June 2017, raked in $104 million premium income,” he added.

    Speaking on countries’ premium income, he noted that whereas the Anglophone West-African region, “which is our home market, contributed 47 of the 2017 premium income, while the rest of Africa, parts of Middle East and Asian markets, generated 53 of their premium income”.

    He said: “The Corporation embarked on a significant market expansion programme over the years and the above is thus an indication of our improved market position in terms of coverage and footprint across sub-Saharan Africa and beyond.

    “Retrocession premium remained relatively unchanged due to increased retention arising from the additional capital raised in December 2016.”

  • Allianz Group completes Ensure’s acquisition

    Allianz Group has completed the acquisition of 99.03 per cent of the shares in Ensure Insurance Plc from its core shareholder, Greenoaks Global Holdings Ltd. (GGH), the Group’s Africa Regional Chief Executive Officer (CEO), Coenraad Vrolijk has said.

    Speaking at a press briefing in Lagos, Vrolijk said Ensure offers life and non-life insurance services and generated 18.2 million euros in gross premiums written in 2017.

    He disclosed that the company will operate in Nigeria as Ensure – a company of Allianz, adding that Allianz Group views Nigeria as a high-potential market in Africa with a strong regulatory environment and promising demographics.

    He said: “We are pleased to enter this fast-growing market through the acquisition of a solid financial player with strong local expertise.

    “This new step of development will allow us to leverage the strength of the Allianz Group and the expertise of the Nigerian team to provide high quality products and services to Nigerian customers in both personal and commercial lines.”

    The firm’s Chief Responsibility Officer, Owolabi Salami, on his part said the acquisition will be highly beneficial to our business and improve our service platform to our valued clients.

    He said the company is excited to harness the depth of technical competence that Allianz has acquired over the years and experience garnered through serving clients in various sectors.

    “The Allianz Group is one of the world’s leading insurers and asset managers with more than 88 million retail and corporate customers. Allianz customers benefit from a broad range of personal and corporate insurance services, ranging from property, life and health insurance to assistance services to credit insurance and global business insurance.

  • FBNInsurance Group to be Tier 1 company

    •Says new regulation will eradicate fringe players

    As some insurance firms and Boards grapple to find a direction in the new companies’ categorisation introduced by the National Insurance Commission (NAICOM) last week, FBN Insurance Group has announced that it would be a Tier 1 Company.

    NAICOM recently introduced the Risk Based Supervision (RBS) model titled: “Tier-Based Minimum Solvency Capital”, regime to the insurance industry, a regime which ensures that companies should cover only the risks their financial strength can carry.

    Based on this, the existing 57 insurance firms in the country will now be categorised as high, medium and low players.

    According to the Commissioner for Insurance, Mohammed Kari, the companies will be identified as Tier 1 Company, Tier 2 Company and Tier 3 Company respectively from January 1, 2019.

    FBNInsurance Limited Managing Director,  Val Ojumah, while briefing reporters in Lagos on the decision of the company as regards where it wants to play under the categories, said FBNInsurance Limited and FBN General Insurance Limited have the financial wherewithal to operate in the Tier 1 category.

    He said the Group believed that RBS introduction was one of the best things to happen to insurance industry in Nigeria.

    He noted that it has been clear to many people that a lot of insurance firms are fringe players and this has had negative impact on the industry.

    He said: “We have so many fringe players and as a result we have suffered as an industry from all sorts of malpractices. If you look at the financials of many companies, you will find out that many of them are indeed, struggling and because they are struggling, they tend to try to survive by doing whatever and this has brought collective shame to the industry.

    “In our view we believe that the recent statement from the regulator is intended to address several ills of the industry. It is aimed at encouraging people to take risk in accordance with their financial strength. In insurance it’s not just about your capital, it’s more of shareholders’ funds even before reinsurance. Early this year, NAICOM published names of some companies that are insolvent, but because of the challenges of withdrawing insurance certificate of operators, the regulators had no choice but to leave these companies in the market. The continuity of the companies in the market has not been good.”

    FBN General Insurance Managing Director,  Bode Opadokun, on his part said the Risk-Based Categorisation will reposition the industry, adding that it will also strengthen firms financial positions and improve their Return On Investment (ROI).

    He commended NAICOM for the initiative, stressing that the step will pave way for engagement of competent hands by underwriting firms and encourage professionalism.

    Executive Director, FBNInsurance Limited, Ekpe Ukpabio also pointed out that the firm supports the initiative as it is going to increase public confidence on insurance, noting, this development will also boost investors’ confidence.

  • Niger posts N8.59b gross premium

    Niger Insurance Plc has posted a gross premium of N8.59 billion in 2017 as against N5.96 billion recorded in 2016, its Chairman, Yusuf Abubakar, has said.

    He made this known at the firm’s Annual General Meeting (AGM) in Lagos, stressing that the premium moved by 44 per cent, which amounted to N2.6 billion.

    He noted that the underwriting profit closed at N1.1 billion from N888.9 million in 2016, adding that the total assets grew by one per cent from N22.5 billion in 2016 to N22.8 billion, the insurance contract liability grew to N10.02 billion from N8.86 billion in 2016 and shareholders funding standing at N7.84 billion.

    Abubakar said the underwriting firm, in compliance with regulatory requirements, had resolved to dispose investments in real estate. He added that due to cost control measures put in place, the management expenses came down to about nine per cent, moving from N2.75 billion in 2016 to N2.51 billion last year.

    He noted that the firm’s board has reached an advanced stage on discussions with investors, who will add to the capital and bring technical expertise to the company.