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Tag: African Alliance

  • African Alliance: Sailing into troubled waters

    African Alliance: Sailing into troubled waters

    African Alliance Insurance Plc is in distress and has shut down its headquarters and its Ilupeju branch, leaving pensioners under the Contributory Pension Scheme (CPS) and others insured in tears. OMOBOLA TOLU-KUSIMO writes

    All is not well at African Alliance Insurance Plc as the once-thriving firm has shut down since August 1,  as its headquarters at 54, Awolowo Road, Ikoyi, Lagos with its managing director and other key staff members reportedly deserting the company.

    This follows the company’s years of its inability to pay claims arising from insolvency and, consequently, leading to its comatose.

    The Nation has been following up on the company’s footsteps and has in the recent past written on its insolvency.

    While the August 1 suggests the company closed its doors due to the nationwide protest, it has since remained on lockdown.

    With this development, the insurance industry has yet suffered setbacks on trust issues from the public, following the recent death of notable insurance companies like Niger Insurance and Standard Alliance Insurance Plc.

    Pensioners are owed monthly pensions with many insured owed billions of claims while those with savings-backed policies are unable to access their money.

    A visit to African Alliance headquarters last week showed an office under lock, deserted by the managing director and other staff members. It is not clear as at press time who is the managing director because there are speculations that Mrs. Joyce Ojemudia had resigned as the MD.

    Findings further showed the company’s website is still up as at yesterday 11am, requesting the unsuspecting public to buy policies.

    Some experts have said it appeared that the regulator treated the company’s problems with kids’ gloves, leading to the trapping of billions of pensioners’ funds under the Contributory Pension Scheme (CPS) who opted for Life Annuity at retirement and chose African Alliance as managers of their funds.

    It was not until last month that National Insurance Commission (NAICOM) scolded the insurer, issuing an ultimatum ordering the company to settle outstanding claims and submit turnaround plans.

    NAICOM in a statement on July 5, 2024 entitled: “NAICOM gives matching orders to the Board of African Alliance Insurance Plc” stated: “Following increased complaints by annuitants and insurance claimants against African Alliance Insurance Plc in respect of the company’s delay and/or inability to fulfill its obligations, the National Insurance Commission has given marching orders to the company to resolve and ensure settlement of outstanding claims.

    “The Commission had summoned the Board of African Alliance Insurance Plc to its headquarters in Abuja recently and ordered the company to settle outstanding payments due to annuitants and claimants. In addition, the Board of Directors of the company was directed to immediately submit a turnaround plan for addressing the challenges currently faced by the company which necessitated putting the company under the Commission’s Regulatory Order. Given the heightened challenges, the company should expect further actions if they fail to address the issues within the timeline the company has been given.

    “The Board assured the Commission that they would act on the resolutions reached at the meeting. The Commission wishes to restate its determination to ensure fair treatment of stakeholders, enforce professionalism and good conduct amongst its licensed operators.”

    Annuity pensioners in tears

    My name is Mrs. Anichebe, an Annuitant with African Alliance Insurance Plc. I opted to be paid once in a year which was pegged on March every year.

    This choice was to enable me to submit my children’s educational fees. But since the end of March 2024 and up till date, I have not been paid. I am not the only victim.

    Read Also: NAICOM orders African Alliance to settle annuity payment, claims

    Another victim speaks

    I am retired ASP Moses and an annuitant receiving monthly pension from African Alliance Insurance since 2015. But for about three months, they have not paid me nor given any explanation to that effect. I would like to know what the problem is from the National Pension Commission (PenCom). I need my money to assuage my sufferings.

    My name is Odunsi. African Alliance has not paid my monthly pension. They didn’t pay me in February and March but later paid in April. But again, they have not paid me from May till date. I am speaking on behalf of so many pensioners in the country. We want to know whether the company is distressed or bankrupt. We are old people and only rely on the peanuts we get from pension to survive. But the African Alliance is becoming our nightmare.

    I am Atokunleki, my insurer is African Alliance Insurance. I am yet to receive my monthly pension from May till date. I am hungry and weak. The same problem occurred in February and March. Take for instance, my drugs are exhausted now and I need to buy them, but how, when my pension is being withheld?

    Insured

    An insured with a savings-backed policy, Mrs. Ronke Ibrahim, who was at the headquarters last Thursday was shaken seeing the company locked up.

    Crying, she said she had been saving N400,000 after being introduced to the company by her friend.

    “I am a petty trader struggling to take care of my three children. I was introduced to the company by my friend. Sometimes in October, last year, she called me and told me to go and request for my money as she has been unable to collect the N1.8million she invested in a savings policy with the company.

    “I quickly ran down to the company but they have been tossing me up and down since then. I went to their Ilupeju branch recently and I found it locked up. That is why I came to the headquarters only to find it locked up too. I am in a dilemma,” she said.

    Mr. Ndubuisi, on his part, said, he was in a shock, having found that he had lost his money to African Alliance.

    He blamed the regulator for allowing the company to deceive Nigerians by allowing them to be in business despite being insolvent for a long time, adding that he only got to know when it was too late for him to retrieve his money.

    An expert, who spoke on condition of anonymity, said though NAICOM had taken action against the company a long time ago, Alliance directors had not been sincere in their plan to resuscitate the company by pumping in money for despite promising to do so.

  • ‘African Alliance records 78% gross premium in Q1’

    African Alliance Insurance Plc said it recorded a 78 per cent increase in gross premium in first quarter (Q1) this year compared to the same period of last year.

    Its Managing Director, Mrs Funmi Omo, in a statement, explained yesterday ahead of the firm’s release of its audited financials, said the firm has grown strategically during the past year.

    She said: “In the same Quarter 1, we paid claims worth N1.8 billion as against N1.5 billion in the same period last year. We are in a strong financial position, and our recent investments and decisions back this. To further demonstrate its commitment towards financial inclusion and its brand promise to protect the future of every Nigerian, the company recently embarked on a nationwide Takaful campaign aimed at spreading kindness nationwide. The campaign is a call to spread kindness and work together towards achieving life’s goals.

    “In response to the campaign, one of our customers commented: ‘Your Takaful services have been excellent. Your account managers remained impressive in relationship management, and most importantly, payment of claims have been prompt. Hence, the reason I have been able to refer more people to get your Takaful Plan over the years”.

    Read also: African Alliance rebrands

    “The company recently embarked on its first rebranding campaign since its 58-year existence. The rebranding, led by me, was the first in the company’s history. This is in a bid to refresh the brand and align its internal digital transformation to its outward, youthful look and feel. The new logo boasts of two solid shades of blue and diamond shape. Life is precious to every one of us. There is no other country in the world where people are resilient and determined to make the most out of life. Our new diamond logo demonstrates how special our customers are to us.” She added that the company’s focus on digital transformation will not only boost internal process efficiency but take the conversations to the customers on the digital channels for better customer experience.

    “Right now, a customer can take a policy from the comfort of their homes on our website or through social media. It does not get easier than this. “

     

     

  • African Alliance in financial crisis

    African Alliance Insurance ‘s five-year financial result has revealed a worrisome outcome, The Nation investigation has shown.

    African Alliance, a life insurer, which is preparing to celebrate its 60 years’ anniversary, appears to be in a critical condition.

    This is going by the company’s five- year financials obtained by The Nation from the firm’s website. It showed negative in Solvency Margin, Shareholders Fund and Annuity Cover.

    The result showed an erosion and  depletion of Shareholder’s Fund to the tune of N281.56 million and Solvency Margin deficit of 376 per cent as recorded in its 2017 financial result.

    The company solvency margin is in deficit of 376 per cent in the period under review, which is below the minimum regulatory capital of N2 billion required by the National Insurance Commission (NAICOM) for life insurance business.

    This constitutes non-compliance with the regulatory capital requirements. The continuation of the company’s operation is dependent on its ability to meet its regulatory capital requirement and generate sufficient cash flows to meet its obligation as they fall due.

    Similarly, the company’s annuity fund has been eroded. The Annuity Fund Solvency Margin is a negative of 10.69 per cent, far less than the 30 per cent required minimum solvency stipulated by the Pension Reform Act (PRA) Annuity Regulations.

    As shown in 2016 and 2017 results, the company has in the past two years been operating a negative solvency margin of N2.6 billion and N5.52 billion respectively. This showed that the financials of the company worsened in 2017 compared to the previous year.

    Read also: FBNInsurance drives sales with Ember Championship

    It posted a negative gross solvency margin of 130 per cent for 2016 and the shortfall in assets cover for contract liabilities of N2.23 billion was negative, indicating that the company will be unable to meet its contract liabilities when they fall due.

    The situation deteriorated in 2017 with a negative net solvency margin of 376 per cent and a shortfall in assets cover for contract liabilities of a negative of N6.084 billion.

    Despite the resolve of the company’s Board and management to turn around the situation in 2017, according to their 2016 report, the situation  deteriorated.

    Other indices such as Profit after Tax, Gross Premium Written, Assets and Liabilities also declined. It also made loss of N4.16 billion in its Profit Before Tax in 2017 as against the N3.216 billion made in 2016.

    Its Gross Premium Written also fell by N6.6 billion in 2017 from the N12.9 billion it recorded in 2016.

    Consequently the company may need an urgent intervention by the regulatory authority for it to meet its major obligation of claims payment to policyholders. According to the company’s financial report, the latest available actuarial valuation of the liabilities for Annuity Fund of the company as at 31 December 2016 was carried out by HR Nigeria Limited.

    The report read: “The book value of the liabilities for Annuity Fund in 2016 is N27.26 billion. The minimum required solvency margin is N8.17 billion and the available Shareholder’s Fund is N3.6 billion which is less than the required minimum solvency requirements stipulated by the Pension Reform Act (PRA) 2014 Annuity Regulations under the supervision of the National Penion Commission (PenCom). The PRA Annuity Regulations require the life insurer to demonstrate a minimum solvency margin of the Annuity Fund of 30 per cent.”

    In the 2017 financial report, the company’s retained earnings is a negative of N26.15 billion. This is the amount set aside from their previous losses over the years.

    Further checks by The Nation  showed that the company had a shortfall of solvency cover of N4.579billion, which is just 7.57 per cent solvency cover for Annuity Fund as at December 2016 as against the 30 per cent required by law.

    As stated in the financial statement: “The National Insurance Commission (NAICOM) specifies the minimum amount and type of capital that must be held by the company to cover the insurance liabilities. The regulator measures the financial strength of insurance companies using the capital adequacy requirements for the category of company. This test compares insurer’s capital against the risk profile.

    “The book value of the liabilities for Annuity Fund is N30.09 billion for 2017 report. The minimum required solvency margin is N9.028 billion and the available Shareholder’s Fund is negative of N281.56 million, which is less than the required minimum solvency requirements stipulated by PenCom’s PRA Annuity Regulations. The PRA Annuity Regulations require the life insurer to demonstrate a minimum solvency margin of the Annuity Fund of 30 per cent.

    On the company’s 2015 result, the report stated: “The total admissible assets of the company less the net insurance and investment contract liabilities is a deficit of N4.817 billion. The shareholders fund is N613 million. The company also recorded a negative Solvency Margin of N5.727 billion.

    “This is below the minimum regulatory capital of N2 billion required by NAICOM for life insurance business. These constitute non-compliance with the regulatory capital requirements. The continuation of the company’s operation is dependent on the ability to meet its regulatory capital requirement and generate sufficient cash flows to meet its obligation as they fall due,” the report read.

    According to the company’s Auditors, Deloitte & Touche (Chartered Accountants), As at December 31, 2017, the company and the group made Loss After Tax of N3.7 billion and N6.2 billion. Added to this is a negative Solvency Margin of N5.5 billion.’’

    Delliotte added that the total admissible assets of the company less Net Insurance and Investment Contract Liabilities amounted to a deficit of N6 billion. These conditions indicate the existence of a material uncertainty that may cast doubt on the company’s and Group’s ability to continue as a going concern.

  • African Alliance rebrands

    AFRICAN Alliance Insurance Plc has launched a new identity with potential for stronger growth through innovation and branding.

    The Interim Chairman, Board of Directors, African Alliance Plc, Anthony Okocha, affirmed that the life insurance company   would continue to break new grounds and increase the joy of its  customers.

    He said the rebranding has refreshed their identity to align with their new business strategy.

    The company’s Managing Director, Mrs Funmi Omo, said the great heritage of African Alliance Insurance began almost six decades ago on May 6, 1960 by its founders – Chief S.L. Edu, Mr T. A. Braithwaite and Chief M.E.R. Okorodudu-backed by leading reinsurers and co-shareholders, Munich Reinsurance Company.

    She said: “This year, in line with our strategic direction and focus, we have embarked on a corporate rebranding process including development of a corporate brand strategy, a new brand identity, and new corporate tagline to drive up our impact and success as an organisation.

    “As we turn a new chapter today in our history, we remain true to our core values of accountability, accessibility, integrity, professionalism, loyalty and creativity. We are committed to protecting the future of every Nigerian, and are relentless in our mission to improve the quality of life of our clients while adding value to our shareholders. Our new brand identity consists of these colours –Blue and Grey. Blue represents loyalty, strength, wisdom, trust, technology and stability. While the colour grey stands for friendship, maturity, imagination, sophistication, security, reliability and intelligence”, she added.

  • NSE lifts suspension as African Alliance Insurance loses N6.25b

    The Nigerian Stock Exchange (NSE) has lifted suspension  on trading in the shares of African Alliance Insurance Plc, ending 18-month suspension that made the company stagnant on the same price and without trading activities.

    The lifting of the suspension was sequel to the submission of relevant financial statements to the Exchange, including the audited report and accounts for the year ended December 31, 2017.

    The NSE on July 5, 2017 suspended trading in shares of African Alliance Insurance and 16 other companies for failing to adhere to best corporate governance and extant post-listing requirements that require quoted companies to submit their periodic financial statements and reports within stipulated timelines.

    Post-listing rules at the NSE require quoted companies to submit their audited earnings reports, not later than 90 calendar days, or  three months, after the expiration of the period. The rules also require quoted companies to submit interim report not later than 30 calendar days after the end of the relevant period.

    Not less than 83 per cent of quoted companies use the 12-month Gregorian calendar year as their business year. The business year thus terminates on December 31. While March 31 is usually the deadline for submission of annual report for companies with Gregorian calendar business year, the deadline for the quarterly report is a month after the quarter.

    Key extracts of the audited report and accounts for the year ended December 31, 2017 showed that African Alliance Insurance recorded net loss of N6.25 billion on gross premium of N7.63 billion in 2017 compared with net profit of N2.44 billion on gross premium written of N14.07 billion recorded in 2016.

    The management of the insurance company stated that the 46 per cent decline in gross premium written as well as 48 per cent reduction in net premium revenue and underwriting loss of N7.1 billion were due to the decision to downplay annuity business amid tough operating environment.

    The net loss of N6.25 billion, which was transferred to retained earnings, wiped off the shareholders’ funds of the company, leaving negative equities’ funds of N511.2 million. Total assets stood at N43.83 billion as against total liabilities of N44.34 billion in 2017 as against total assets of N45.65 billion and total liabilities of N40.2 billion in 2016.

    Incorporated as a private limited liability company in May 1960, African Alliance Insurance was the first indigenous insurance company to carry out the business of life assurance in Nigeria. In 2005, it also pioneered the sale of Takaful (Islamic Insurance) in Nigeria through a robust selection of Sharia compliant insurance and investment products. It also in 2005 went into a joint venture with First Securities Discount House Limited (FSDH) to set up Pension Alliance Limited (PAL), a licenced Pension Fund Administrator.

    The African Alliance Insurance Group included Axiom Air Limited, a cargo airline company, Frenchies Foods Nigeria Limited, a restaurant and catering company and Ghana Life Insurance Company Limited, a life company in Ghana.

    In the reporting year, the company voluntarily wound down African Alliance Realty Company Limited and Frenchies Foods Nigeria Limited.

  • African Alliance posts N6.29b income

    African Alliance Insurance Plc posted its results for 2017 showing a gross premium income of N6.2 9 billion. The firm, which marks its 58 years of service on May 6, 2018 also had 32.5 per cent growth in claims payout from N6.56 billion in 2016 to N8.69 billion in 2017.

    Managing Director, African Alliance Insurance Plc, Mrs. Funmi Omo, commended the achievements of the company stating that it is only the beginning of the transformation rolled out by its present management with the approval of the Board. She said that African Alliance Insurance strategic vision and culture of innovation has been sustained since its inception in 1960.

    “We are proud of our milestone achievements, but this is only the beginning. As a financial services company with a vision of improving the quality of life in Nigeria, we realise that we cannot achieve this without technology. We are currently working on the complete transformation of our systems and processes to provide excellent services and relevant solutions to our customers,” she said.

    She indicated that one of the company’s top priority is establishing a sound corporate governance track record to further establish the confidence of shareholders.

    “We have partnered with the foremost accounting and auditing firm, Deloitte & Touche to ensure that all remittances, policies, regulations and deadlines are strictly adhered to. We have also partnered with Ernst & Young for sound technical advice to better position our company. Our shareholders have complete confidence in our ability and commitment to returning value to them and to the society”.

    To celebrate the 58th anniversary, African Alliance Insurance Plc has commenced a campaign to educate the public on the value of insurance as a means of increasing and protecting wealth.

     

  • African Alliance: we’ve paid N46.1m NSE’s fine

    African Alliance Insurance said it has paid N46.1 million fine slammed on it by the Nigerian Stock Exchange (NSE) for late submission of its 2015 and 2016 financial account, its Managing Director, Mrs Funmi Omo has said.

    She spoke against the backdrop of media reports that the NSE imposed the fine on the firm for breaking its rule on account submission.

    Mrs Omo said: “We were fined by the NSE but we have paid. Perhaps, the reason why the fine is still in the exchange report is because we have not (formally) written to the Exchange (to notify it about the payment).”

    The fine on the company was shown in the Exchange X-Compliance Report of the NSE last updated April 12, 2018.

    According to the NSE, the company filed its audited and interim financial statements after the regulatory due date, stating that it applied sanctions in accordance with the Rules for Filing of Accounts and Treatment of Default Filing under the Rulebook of The Exchange.

    In addition, the Exchange described the company as a delinquent filer of audited accounts as it fell short of the minimum listing standards.

    in terms of timely disclosure of its audited annual financial performance and has Missed Regulatory Fillings (MRF) or Awaiting Regulatory Approval (AWR) of their primary regulators which is the Nation Insurance Commission (NAICOM).

  • NSE fines African Alliance N46.1m for late account submission

    •Firm records N21b negative reserve

    The Nigerian Stock Exchange (NSE) has imposed a fine of N46. 1 million on African Alliance Plc for breaking its rule on account submission.

    According to NSE X-Compliance Report, released on April 12, 2018, the  fine is for late submission of its 2015 and 2016 audited accounts.

    The fine and management expenses have, however, affected the reserves of the company as it recorded N1.49 billion management expenses and negative reserves amounting to -N21.05 billion during the period under review.

    With the negative reserves, the company may not be able to meet most of its responsibilities, especially prompt claims payment.

    According to the NSE, the company filed its audited and interim financial statements after the regulatory due date, stating that it applied sanctions in accordance with the rules for filing of accounts and treatment of default filing under the Rulebook of The Exchange.

    In addition, the NSE described the company as a delinquent filer of audited accounts as it fell short of the minimum listing standards in terms of timely disclosure of its audited annual financial performance and has Missed Regulatory Fillings (MRF) or Awaiting Regulatory Approval (AWR) of their primary regulators, which is the National Insurance Commission (NAICOM).

    The shareholders of the company have expressed their displeasure at the way the company is being run, stating that instead of rewarding the shareholders, who have stood by the company during trying times, the firm is busy paying millions in fines to regulatory bodies.

    Speaking on behalf of shareholders in the insurance industry, the President, Progressive Shareholders Association of Nigeria (PSAN), Mr. Boniface Okezie, said: “Some insurance companies have  corporate governance issues. We commend NAICOM because it will not approve any account unless it is thorough. We give kudos to the Commission for safeguarding the interest of the investors as well as customers.”

    Insurance stocks, he said, have been unprofitable for shareholders for some years now as managment has not been able to give good returns on investment. He noted that this was the reason why share prices have remained at par value.

    He said shareholders react to the results a company releases, its dividend payout, its future prospect, adding that insurance companies have failed in all these.

    “So, where do you expect the price to go? The price would remain as it is. It is the dividend payout that throws up the prices, and so long as you don’t pay a commensurate dividend to the shareholders, that is what you get,” he said.

    Meanwhile, NAICOM has frowned at the attitude of some insurance operators for failing to file annual reports.

    A top NAICOM official said some companies, especially those quoted on the floor of the NSE file their reports as late as March 29 when indeed, the deadline for submission is March 30.

    He stressed that this is despite the Commission’s decision to fast-track approval for all quoted companies.

    He noted that the financial year end for insurance companies, as it is for other financial sectors, is December.

    He said the Commission is saddened that some operators still struggle to meet up with the deadlines.

     

  • African Alliance appoints Funmilayo Omo MD/CEO

    African Alliance Insurance Plc has appointed Mrs

    Funmilayo Omo as the Managing Director/Chief Executive Officer of the underwriting firm.

    In a statement, the firm’s Corporate Communication Manager, Stella Osanebi, said Omo’s appointment okayed by the Board of Directors, had been confirmed by the regulatory body, the National Insurance Commission (NAICOM).

    According to the statement, Omo was appointed Acting Managing Director of the 56-year-old life specialist firm last March 3, following the retirement of the erstwhile Managing Director, Alohons Okpo.

    Omo received B.Sc (Insurance) from the University of Lagos (UNILAG) in  1990. She trained as a Life Insurance Underwriter at Munich Re in South Africa and has over 26 years’experience in Life and Pension Business.

    In 1991, she joined African Alliance Insurance Plc (then a Limited Liability Company), as an Assistant Superintendent and later rose to the position of Controller (Technical Operations), Individual Business in 2004.

    In 2006, she became an Assistant General Manager from where she advanced to become the Executive Director and Head of Life operations of the company.