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By Henry Uche
National Insurance Commission last week inaugurated the Nigerian Actuarial Society Discount Rate Committee (NAS-DRC) to support the setting of standardised basis of determining discount rate factors for insurance contract.
The Commissioner for Insurance, Mr. Sunday Thomas, explained that the standing committee is to support the setting of a standardised basis of determining discount rate factors for use by the insurance industry and other stakeholders in the financial services sector, particularly in the implementation of the International Financial Reporting Standard 17 (IFRS 17), insurance contracts.
The membership of the NAS-DRC was drawn from representatives of NAS, NAICOM, Actuarial representatives of Audit Firms, as well as Resident Actuaries of Insurance Operators (with annuity business).
Thomas said the president of NAS and a representative of NAICOM (not below the rank of a Director) will serve as Chairman and Co-Chairman respectively, while the NAS shall provide the secretariat.
NAICOM boss reiterated the critical role of actuaries in the implementation of IFRS 17, as well as the need for credible, prudent, consistent and sustainable discount rate devoid of possible manipulation by different stakeholders.
He listed the objectives of the NAS-DRC include: determining the risk-free yield curve for use by the insurance industry and to provide commentary on any market movement that might impact on the determination of the risk-free yield curve.
“It is my sincere expectation that the inauguration of the NAS-DRC will no doubt enhance accountability, prudence and comparability in financial reporting and thereby support the stability in the Nigerian financial system. I am hopeful that the activities of the NAS-DRC will bring about the desirable impact for the Nigerian financial system,” he affirmed.
