Follow Us on Google
By Henry Uche
Some insurance companies and critical stakeholders in the insurance sector have commended the National Insurance Commission (the Commission) over its recent circular (policy statement) which outlined additional regulatory requirements for life insurance companies carrying on annuity business in Nigeria.
According to them, the directive is a testament that the new administration of Mr. Olusegun Omosehin is thinking forward and strategically to position the sector in its rightful place in the financial sector.
To them, a continuous policy statement which includes directives and regulations from NAICOM that would catapult the sector to enviable height would be a welcome development and endear the publics to the Insurance business. This and more futuristic policies and regulations would be made possible through research and development.
An annuitant, Davids Kolade, said he believes in the capacity and capability of NAICOM’s helmsman to protect policyholders and annuitants alike.
According to him, Mr. Omosehin would leave nothing to chance and would do humanly but legally possible to galvanise all stakeholders in the insurance industry to contribute their quota in support of President Bola Tinubu’s economic ambition of a N1 trillion economy by 2030.
“I believe in the mental capacity of the NAICOM boss. I have known him over a decade and I think he has the interest of policyholders and other stakeholders at heart. I would urge him to learn from countries with deeper insurance penetration and know why they tick.
Other News
“The onus rests on his shoulders to make Nigerians embrace insurance, because it’s not a small task before him. If you like to preach from now to thy kingdom come, most Nigerians have made up their minds not to adopt insurance. But insurance is a serious business on which other businesses fall back to come back in times of calamities” he maintained.
NAICOM had on January 24, 2025, issued a circular to enshrine best practice in the management of annuity portfolios of insurance institutions in furtherance to ensuring a safe, sound, and stable insurance sector. The insurers companies in Nigeria were given a six-month deadline to comply with a new annuity guideline.
Some key requirements of the circular include: Qualified Actuary: Insurance companies are required to have at least one qualified actuary responsible for Assets-Liability Matching (ALM) analysis and implementation.
ALM Reports: Companies are required to submit ALM reports to the Commission quarterly, with requirements outlined in the circular such as required actions by insurers depending on the results from specific analysis applying guidance provided in the NAS Standards of Actuarial Practice (NSAP).
Regulatory Compliance: Insurance companies are required to comply with the new requirements, with the Board of Directors responsible for ensuring strict compliance.
Transfer of Annuity Portfolio: Companies that are unable to cover the additional expenses imposed by the circular are required to transfer their annuity portfolio to another suitable insurance company within 180 days.
Effective Date: The circular takes effect on February 1, 2025. Insurance companies are expected to comply with the new requirements to ensure a stable and secure annuity business in Nigeria.
