The Nation Newspaper

Tag: NAICOM

  • ‘Insurance sector records growth’

    The insurance sector recorded improvement in the past few years as its contribution in the ratio of premium to the nation’s Gross Domestic Product (GDP) increased from 0.5 per cent to 0.7 per cent.

    The Commissioner for Insurance, the National Insurance Commission (NAICOM), Fola Daniel, disclosed this during the opening of the commission’s Northcentral Zonal office in Ilorin.

    He said the sector’s gross premium income increased from N157billion in 2010 to N250billion last year, which resulted to an increase in the ratio of premium to GDP.

    Speaking on other achievement recorded, he said companies with foreign equity increased from three to 10, generating substantial foreign direct investment.

    He added that there was also an increase in local capacity for oil and gas risks from 10 per cent to 48 per cent while the commencement of implementation of Section 50 of the Insurance Act 2003 on ‘No Premium, No Cover’ has improved financial assets of operators.

    He said: “The sector recorded increase in the number of policyholders from 500,000 in 2010 to 1,500,000 in 2012 and collaborated with PENCOM to develop the annuities market.

    “These are all the outcome of efforts by the Commission which is already being felt in the industry and by extension, the economy following the massive sensitisation campaigns across the country.

    “The campaign was to further educate and inform the public about insurance, build confidence and grow the gross premium income.”

    The commissioner noted that the Governing Board of the Commission in 2011 approved the establishment of three additional Zonal Offices to be located in Ilorin, Port-Harcourt and Maiduguri as part of the mandate to deepen insurance penetration and awareness in the country.

    These locations, he said were carefully selected owing to their strategic economic importance and relevance to the growth and development of insurance in the respective zones noting that the Ilorin branch will serve the entire Northcentral zone.

    We are making arrangements to commission the Southsouth and Northeast Zonal offices, he added.

     

  • NAICOM revokes Fortune Assurance’s licence

    • Advises policy holders on Bendel Insurance 

    The National Insurance Commission (NAICOM) has revoked the certificate of registration of Fortune Assurance Company Limited.

    It said the revocation of the licence of the firm took effect from June 14, warning members of the public against dealing in any of the company’s properties without recourse to the commission

    The Commissioner for Insurance, Mr Fola Daniel, said it has also started the process of releasing money received by the company from Suffolk Petroluem Services Limited as deposit for shares during the failed recapitalisation of the company in 2007. It added that correspondence relating to Fortune Assurance Limited (in-liquidation) be addressed to the commissioner.

    The commission also advised insured with claims against Bendel Insurance Limited and other stakeholders to contact the receiver and liquidator of the company.

    NAICOM cancelled the certificate of registration of the company.

    It stated that Felix Imagbe Oboh Esq. of Oboh & Associates was appointed as the Receiver/Liquidator to wind up the affairs of the company.

  • 41 insurance firms yet to submit 2012 financials, says NAICOM

    41 insurance firms yet to submit 2012 financials, says NAICOM

    With less than five days to June 30 submission deadline required by the National Insurance Commission (NAICOM) for insurance companies to submit their 2012 financial statement, 41 companies are yet to comply.

    This was disclosed yesterday by the regulatory body, NAICOM in a status report of Insurance Companies 2012 Financial Statement as at Monday, June 24, 2013.

    It noted that only three companies, which include Mansard Insurance Plc, ADIC Insurance and Wapic Insurance Plc have submitted and gotten approval on their 2012 financial statement.

    The commission reported that financial statements of companies such as FBN Life Assurance Ltd, AIICO Insurance Plc and Oasis Insurance Plc are presently been queried and are as such awaiting their responses.

    Meanwhile, Consolidated Hallmark insurance whose statement has been queried by the commission and responses made is currently undergoing review.

    In the same vein, Continental Re, Law Union and Rock Insurance and NEM Insurance Plc have just submitted their statements, which are being reviewed by the commission.

    NAICOM has in recent time’s maintained strict reporting standard in the financials of insurance companies.

    Commissioner for insurance, Mr. Fola Daniel said the commission would never approve any account that fails to meet the required standard.

    There are 59 insurance companies in the country with 17 operating as life, 32 as non-life and 10 as composite.

  • 2012 reports: ADIC, Mansard get NAICOM’s approval

    2012 reports: ADIC, Mansard get NAICOM’s approval

    Two underwriters, ADIC Insurance Plc and Mansad Insurance Plc, have crossed the hurdle of the International Financial Reporting Standard (IFRS) in their 2012 financial reports and secured the nod of the National Insurance Commission, The Nation reveal.

    The National Insurance Commission (NAICOM), the regulatory body of the insurance sector, has maintained strict reporting standard in the financials of insurance companies.

    It was also gathered that more underwriters have submitted their IFRS compliant accounts to the NAICOM to enable them to beat the June 30, submission deadline required by the industry’s law.

    Assistant Commissioner, Finance and Admin, NAICOM, Mr. George Onekhena confirmed to The Nation.

    He maintained that the commission would never approve any account that fails to meet the required standard.

    There are 59 insurance companies in the country with 17 operating as life, 32 as non-life and 10 as composite.

    They include Alliance & General Life Assurance Plc; African Alliance Insurance Company Ltd; ADIC Life Assurance Ltd; ADIC Insurance Company Ltd; AIICO Insurance Plc; AIICO General Insurance Company Ltd; Anchor Insurance Company Ltd; Capital Express Assurance Limited; Consolidated Hallmark Insurance Plc; Cornerstone Insurance Plc; Cystal Life Insurance Limited; Crusader General Insurance Ltd; Crusader Life Insurance Limited; Custodian & Allied Insurance Plc; Goldlink Insurance Plc; Great Nigeria Life; Spring Life Assurance Plc; Guaranty Trust Assurance; Guinea Insurance Plc; Industrial & General Insurance Plc;

    Others are Insurance PHB Limited; International Energy Insurance Plc; UnityKapital Assurance Plc; Lasaco Assurance Plc; Lasaco Life Assurance; Law Union & Rock Insurance Company Plc; Leadway Assurance Company Limited; Linkage Assurance PLC; Mutual Benefits Assurance Plc; Mutual Benefits Life Assurance Company Ltd; NEM Insurance Plc; Niger Insurance Plc; Nigerian Agricultural Insurance Corporation; Oasis Insurance Plc; Oceanic Insurance Company Ltd; Oceanic Life Assurance Assurance Limited; Prestige Assurance Plc; Regency Alliance Insurance; Royal Exchange Assurance; Royal Prudential Life Assurance Plc;

    Sterling Assurance Nigeria Ltd; Sovereign Trust Insurance Plc; Staco Insurance Plc; Standard Alliance Insurance Plc; Standard Alliance Life Assurance Company Ltd; Universal Insurance Company Ltd; UBA Metropolitan Life Insurance Company Ltd; Investment & Allied Assurance co. Ltd; Union Assurance Company Ltd; Unitrust Insurance Company Limited; Intercontinental WAPIC Insurance Plc; Intercontinental WAPIC Life Assurance; Fin Insurance Company Limited; Zenith Insurance Company Limited; NICON Insurance; FBN Life Assurance Company Limited.

  • Brokers decry NAICOM’s registration fee

    Brokers in the industry have condemned the increase in brokers licence processing fees from N1million to N2.5million by the National Insurance Commission (NAICOM).

    The brokers, who spoke on condition of anonymity, also accused the commission of frustrating them out of business.

    One of the brokers said insurance brokerage is one area that enables chartered insurance practitioners to practice, but with the new fee, it has become difficult for prospective brokers to practice in the field they choose to.

    He said: “The new licensing fee can be seen as a barrier to anybody willing to practise as a broker. This kind of fees does not abound in other professions like accountancy, law, estate surveyors, quantity surveying among others.

    “If the regulator wants to deepen insurance penetration and increase awareness, then we need skilled and knowledgeable people and the new fees does not encourage this.”

    A female broker, who also spoke on condition of anonymity, said this kind of regulation can be frustrating to people wishing to take part in the profession.

    She noted that though the new fees do not directly affect brokers who have been practising, it affects professionals in the industry.

    But Assistant Director, Corporate affairs, NAICOM, Mr. Rasaaq Salami, said the new fees which took effect from January 1, this year only affects new brokers.

    The commission, as part of efforts aimed at effective service delivery, directed that registration of new brokers by the Commission would henceforth be done in two batches yearly.

    The commission said: “Consequently, operating licences to successful applicants in the first batch would be issued on June 31 of each year, while the second batch shall be issued on December 31 of the same year.

    “For applications falling due in the first batch, all relevant documents are expected to reach the commission not later than March 31, while those for the second batch should have been received in the Commission on or before September 30 for processing.

    ‘’Applications and support documents received after March 31 or September 30, shall be treated as part of the next batches for consideration in the succeeding second half of the year.’’

     

  • ‘No valid insurance cover for civil servants, military personnel’

    ‘No valid insurance cover for civil servants, military personnel’

    Civil servants and military personnel may fall victim of the National Insurance Commission’s (NAICOM’s) policy of ‘No premium no cover,’The Nation has learnt.

    Although there is group life policy in place for employees of the Federal Government, renewals and premiums are expected by insurers yearly to validate the contract or cover.

    Sources, who disclosed this to The Nation under condition of anonymity, confirmed that other employees of the Federal Government, including policemen who died in service a year ago and those who are in service are not covered under the Group Life Insurance Scheme jointly required by the National Pension Commission and the National Insurance Commission.

    These workers do not have any insurance cover because of the outstanding 59 per cent premium on Group Life for last year and the non-payment of premium for the year. As at Monday, insurance cover had not been paid by the Federal Government to insurance companies handling the account. The law by the National Insurance Commission (NAICOM) forbids provision of insurance cover by insurers when premium has not been paid.

    Section 9 (3) of the Pension Reform Act 2004 requires every employer having up to five employees to maintain a Life Insurance Policy in favour of the employee for a minimum of three times the yearly total emolument of the employee.

    Meanwhile, the enforcement of Section 50 (1) of the Insurance Act 2003 by NAICOM from January, this year 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”, and voids any form of insurance of which premium has not been paid.

    Although the military opted out of the Pension Reform Scheme recently for security reasons, it could not be ascertained as at press time if they have a valid life insurance policy in place.

    Army spokesman, Colonel kingsley Umoh, in a telephone interview with The Nation said the military has an organisation called the Nigerian Army Welfare Insurance Scheme headed by Colonel S. S. Jiya, which handles its insurance.

    Asked the kind of life insurance arrangement that exists for the military, Jiya said he cannot answer for the Federal Government but the Army. He, however, declined further comment but promised to speak at a later date.

    The Police Public Relations Officer (PPRO), Frank Mba, said the police have three forms of insurance, which includes Group Life Assurance Scheme of the Pension Reform Act, 2004. He could not confirm the validity of premium payment at the moment.

    NAICOM Commissioner for Insurance, Mr Fola Daniel, declined to speak on the issue. When asked to confirm whether or not security forces in the country have life insurance in place or not, he said: “I don’t have anything to say on that.”

    He, however, reiterated the commission’s resolve to enforce sanctions against insurance operators who issue policies or grant covers in violation of Section 50 (1) of the Insurance Act 2003.

    PenCom spokesman, Emeka Onuora, said although it is the duty of the PenCom to ensure that employers comply with the law, it will not be bothered whether premium has been paid or not.

    Speaking in Lagos recently, President of the Nigerian Council of Registered Insurance Brokers (NCRIB),Laide Osijo, disclosed that the Federal Government had only released 41 per cent of the total due premium for last year, noting that people were already due for payment in 2013.

    Osijo said the situation had made many insurance companies to discountenance claims under the year in review, in view of the extant “No Premium No Cover.”

    “This, as we are all aware, is to the displeasure of some beneficiaries,especially those who died in active service. The impression many of them have is that the insurance industry is insensitive to their plight, a situation that creates serious image smear for the industry,” she said.

    She further said the Federal Government would do well to assist the industry to avoid further accumulation of unpaid premiums and claims, a situation she claimed negated the of “No Premium, No Cover” policy.

  • NAICOM, NAIC sign MoU on training

    NAICOM, NAIC sign MoU on training

    The National Insurance Commission of Nigeria, (NAICOM) and the National Association of Insurance Commissioners (NAIC) of the United States have signed a Memorandum of Understanding (MoU) on training and technical assistance.

    In a statement, NAICOM’s Assistant Director, Corporate Communication, Mr. Rasaaq Salami, said the purpose of the memorandum is to help maintain efficient, safe, fair and stable insurance markets in Nigeria and the US for the benefit and protection of policyholders, by providing a framework for co-operation, increased mutual understanding, exchange of information and technical assistance to the extent permitted by respective laws, regulations and requirements.

    He said: “Both NAICOM and the NAIC believe such cooperation will enable them to effectively regulate the industry and entrench international best practices more than ever before.

    “Nigeria’s Commissioner for Insurance, Fola Daniel and the president of NAIC/Commissioner, Louisiana Department of Insurance, James Donelon signed the MoU on behalf of both parties at a well-attended ceremony at the Willard InterContinental Hotel, Washington, DC in the United States.

    “Under the agreement, the authorities will provide mutual assistance periodically through training held in the host country; participation in internships with specific educational focus; educational seminars held in the host country, provision of training manuals/materials and any other issues of common interest.

    “Similarly, both NAICOM and the NAIC have reiterated the importance of complying with the International Association of Insurance Supervisors (IAIS) Core Principles for effective insurance supervision and the Financial Action Task Force (FATF) recommendations on Anti-Money Laundering.”

    NAIC is a non-profit Delaware corporation comprising chief insurance regulatory officers in the 50 states, the District of Columbia and the US territories.

    NAICOM signed a similar MoU with the National Insurance Commission (NIC) of Ghana in August, last year.

  • Shareholders seek NAICOM’s intervention on fines

    Shareholders have called on the National Insurance Commission (NAICOM) to mandate insurance firms to state the reasons for which they incur fines in their financial accounts.

    This, they said, is to enable them to reduce unnecessary payments on offences that affect their investments.

    The shareholders, who were reacting to a statement by NAICOM that what ought to be their dividend were used by companies to pay avoidable fines, called on NAICOM to go beyond just asking firms to state infractions in their accounts and assist shareholders in protecting their investments, by instructing companies to give a breakdown on the penalties for which they are fined.

    The President, Nigerian Shareholders’ Renaissance Association, (NSRA) Olufemi Timothy said the documentation of reasons for fines would help shareholders know who is culpable and what should be done to stem such offence.

    He said: “It is necessary shareholders know why their companies are fined. This will enable the companies’investors to know the kind of offence committed and watch against it in the future. It will also help to determine who is culpable in the company.”

    He noted that shareholders invest their hard earned income in companies to have return on investment, adding that situations where companies’ mismanage funds entrusted to them and leave the investor to suffer, should be discouraged by government and regulators.

    National Coordinator, Pragmatic Shareholders Association of Nigeria (PSAN), Mrs Bis Bakare, called on NAICOM to go beyond reporting of infractions in yearly accounts of firms and ensure that firms state reasons for infractions to enable shareholders query them appropriately.

    She noted that shareholders had at several fora sought from their organisations reasons for delays in the presentation of their accounts, and that the firms often attribute the delay to NAICOM’s refusal to approve the accounts on time.

    She said though the law states that companies should send to the shareholders the annual accounts at least one month before the Annual General Meetings (AGM), they only get the accounts at the venue of meetings.

  • MDRI’s success rate hits 75%

    The Market Development and Restructuring Initiative (MDRI), a programme adopted by the National Insurance Commission (NAICOM) to drive insurance penetration in the country, has recorded up about 75 per cent success, the Managing Director Riskguard-Africa Nigeria Limited, Yemi Soladoye, has said.

    Soladoye, who made this known at a media parley in Lagos, said the initiative is a turning point in the industry, adding that with the initiative, operators, regulators, service providers and the government, have realise that there is something going on in the industry.

    He said prior to the introduction of the MDRI, operators were leading the industry, but with the initiative, the fear of the regulator has become the beginning of wisdom.

    He said: “MDRI is also a turning point because it is from that stage we saw the regulator leading the market. There is a united focus for all of us. Whether you adopt it or not, we all know that there is a project on ground and there is a destination to reach and there is a direction as to the way we can go for us to secure increased penetration for insurance business in this country.

    “The initiative is a watershed in the history of the industry and it is also an evergreen thing. You cannot wish it away, as it has brought about many developments. When you read the strategy document, you would see that micro-insurance is part of the area that was recommended as where the industry will get development.’’

    Soladoye described Takafu as an aspect of the initiative. ‘’As MDRI is targeted at restructuring, all the restructuring that are happening in the market are embedded within the programme,” he added.

    He lauded the efforts of the Commissioner for Insurance, Fola Daniel, saying prior to his appointment, the best the industry had on the premium income was 24 per cent increase, but it has increased to 36 per cent.

    He said the results in the past five years that the Commissioner has been in the saddle, is an indication that the industry will meet its projections.

    He said with the industry’s projection, by the time the insurance firms that are engaging agents start operations, there will be an increase.

    He said as at December 2009, NAICOM had about 1,695 registered agents with different insurance firms, but that a year later, the number increased to 3,404. Despite the success, more firms are yet to embrace retail marketing, which he said, remains a panacea to the industry’s growth.

    “The insurance companies feel that retail system is not the area they want to adopt, despite the fact that the regulator has put in place for them a lot of incentives to make them go into agency recruitment. NAICOM does not have underwriting license neither does it, any brokering licence.

    “The regulator has done all it could, believing that this is what is operating ease where and if underwriters adopt the initiative we will get there. From the reports available to us, we have observed that the underwriters are realigning to embrace the initiative,” he said.

    He said the MDRI has not ended, stressing that there was a delay in the implementation and that the industry will adjust to meet the set targets.

  • ‘Court rulings ‘ll empower NAICOM to implement premium payment’

    The National Insurance Commission (NAICOM) has said it will take advantage of court’s rulings to implement the new premium regime.

    In a circular entitled: Settle court case on partial/instalment/non-payment of insurance premium, signed by its management, the commission noted that the settled Appeal Court cases on insurance premium are clear indications that anything short of full payment at the commencement of an insurance contract renders such transaction null and void.

    It said the Provision of Section 50 (1) of the Insurance Act 2003 which states: “The receipt of 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”, is indeed in the interest of the insured going by decided cases on the issue by competent court of law.

    The Commission quoted case one as Court of Appeal in Ajaokuta Steel Co. Limited V. Corp. Insurance Limited where it was decided that the fundamental purpose of an insurance contract is to give cover for an insurance risk. Thus, a law, such as Insurance Act, which says that there is no insurance cover unless premium was pre-paid, is, in fact, saying that the contract is void if no premium was paid.

    The Commission said: “By virtue of Section 50(1) of the Insurance Act, No 2 of 1997 (as amended), the receipt of insurance premium is a condition precedent to a valid contract of insurance and there can be cover in respect of an insurance risk unless premium was paid in advance.”

    The second quoted case by the Commission in the circular was the case involving Leadway Assurance Company Limited Limited V. J.U.C. Limited (2005) 5NWLR 539 at 543: “By virtue of Section 50(1) of Insurance Act, 1997, the receipt of an insurance premium is a condition precedent to a valid contract of insurance, and there is no cover in respect of an insurance risk unless premium is paid. In other words, a valid insurance contract is made when premium for the insurance is paid.

    “Case 3, in IGI Company Limited V. Adogu (2010) INWLR pt 337 at 357 the Court held that the premium paid must be full and stated that: Section 50 of Insurance Act 2003 does not contemplate installment payment of premium in an insurance contract.”