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Tag: NAICOM

  • Insurance coys settle N145bn claims

    The National Insurance Commission (NAICOM) on Sunday, said that a total of N145 billion was paid as claims to policy holders by insurance companies in the third quarter.

    The Deputy Commissioner for Insurance, Technical, Mr Sunday Thomas, made this known in an interview with the News Agency of Nigeria in Lagos.

    According to Thomas, the figure represents a 30 per cent increase compared with N110 billion paid in the same period of 2017.

    He said the commission also anticipated that the figure would increase than N145 billion in the fourth quarter, “when the claims paid in the quarter are added’’.

    Thomas explained further that the Gross Premium (GP) generated by insurance industry during the period under review stood at N315 billion.

    “This represents a 22 per cent increase over the N258 billion GP in the third quarter of 2017,’’ he said.

    Thomas said that financial inclusion was one of the tools used by the commission to shoot up insurance penetration.

    “The initiative is premised on the fact that getting the mass of the financially-excluded to embrace insurance in one form or another will have a positive impact.

    “The commission has started seeing the impact.

    “However, insurance companies are still encouraged to take up micro-insurance licence in order to develop the market more.

    “The Takaful Market is still grossly under-accessed by the public. There is, therefore, the need for aggressive promotion in aid of financial inclusion, ‘’ Thomas said.

     

  • NAICOM bows to pressure, cancels insurance industry’s recapitalisation ‘with immediate effect’

    The National Insurance Commission (NAICOM) on Friday cancelled the Tier Based Solvency Capital recapitalisation of the underwriting sector with immediate effect.

    The commission gave this notice in a circular to all insurance companies on ‘Withdrawal of circular on Tier Based Solvency Capital policy for insurance companies in Nigeria’, which was signed by the Director, NAICOM, Mr Agboola Pius, on Friday.

    It stated, “Pursuant to the powers conferred by the enabling laws, the commission hereby withdraws and cancels the circular dated August 27, 2018 and titled Tier Based Solvency Capital Policy for insurance companies in Nigeria. This withdrawal and cancellation takes immediate effect.”

    It will be recalled that some few months back, NAICOM announced a raise in the minimum capital base for life, non-life and composite insurance companies seeking to get licences to underwrite all risks in the country from N2bn, N3bn and N5bn to N6bn, N9bn and N15bn, respectively under its tier-based minimum solvency capital structure.

    It later announced an October 1, 2018 deadline, which was not accepted by stakeholders, pushing them to take a legal action against the commission.

    Some shareholders of insurance companies had sued the commission to a Federal High Court in Lagos for insisting on implementing the recapitalisation.

    Justice Muslim Hassan gave an order in a class action brought by the shareholders restraining NAICOM from enforcing the TBMSC policy.

    This led the commission to suspend the implementation of its recapitalisation in October.

    In compliance with the extant rules and injunction issued by the Federal High Court, the commission had said status quo would be maintained and insurers were asked to continue to operate on the subsisting regulatory framework prior to the circular.

    It stated that appropriate regulatory directive would be given upon the completion of the suit.

    But through this latest circular, the regulator cancelled the recapitalisation which had generated a lot of controversies.

     

  • NAICOM suspends recapitalisation of Insurance Firms

    The implementation of Tier-based Minimum Solvency Capital policy for insurance companies operating in Nigeria has been suspended by the industry’s regulator, National Insurance Commission (NAICOM).

    This information was made known by NAICOM in a circular to all insurance institutions titled Update on the implementation of the Tier-based Minimum Solvency Capital policy for insurance companies in Nigeria.
    The policy, also known as the recapitalisation of the industry, put insurance firms into three categories based on their capital base.
    Tier 1 insurance companies are required to have minimum capital base of N9 billion for general insurance and N6 billion for life insurance, implying a composite capital base of N15 billion.
    Tier 2 companies are divided into two categories, with N4.5 billion minimum capital base for general insurance and N3 billion for life assurance. Thus a composite insurance-general and life insurance, will be required to have minimum capital base of N7.5 billion.
    Tier 3 companies will continue to operate on the existing minimum capital base of N3 billion for general insurance and N2 billion for life insurance, implying a composite capital base of N5 billion for a composite tier 3 insurance company.
    Under the risk-based capitalisation approach, tier 1 companies will be able to undertake all risks including annuity and high-level special risks such as energy and aviation risks. Tier 2 companies will undertake retail insurance as prescribed under Tier 1, including commercial and industrial risks and group life assurance while tier 3 companies will only be able to write retail insurance only including micro insurance, motor, fire, agriculture, compulsory liability insurances, individual life, health and miscellaneous insurance.
    The new scheme was to take effect this month, but the regulatory agency has asked insurance companies to continue with the subsisting regulatory framework prior to the circular.
    This, NAICOM explained, was due to a court order directing the regulator to suspend implementation of the policy.
    Some stakeholders in the sector had approached the court to halt the scheme, claiming the timing was not right.
    Justice Muslim Hassan had in September 2018, gave the order in a class action brought by the shareholders restraining NAICOM from enforcing the TBMSC policy, pending the expiration of the 30-day pre-action notice dated September 4, 2018.
    In the circular, NAICOM said. “In compliance with the extant rules and injunction issued by the Federal High Court regarding the tier-based minimum solvency capital framework, which was to take effect from October 1, 2018, the commission wishes to clarify that the status quo will be maintained and insurers are to continue to operate on the subsisting regulatory framework prior to the circular.”

  • NAICOM takes over Unic Insurance

    The National Insurance Commission (NAICOM) on Friday confirmed it had taken over the management of Unic Insurance Plc to reposition the company for better performance.

    NAICOM’s spokesman, Mr Rasaaq Salami, said in an interview with newsmen in Lagos that the takeover became imperative to rescue the company from distress.

    Salami said the commission had subsequently appointed an interim board to manage the affairs of Unic Insurance Plc for the next six months.

    He said the members of the interim board included Mr Samuel Ordu as chairman, Mr Theophilus Eke as Managing Director, Mrs Ifeyinwa Momah and Mr Nicholas Shaiyen.

    “The commission gave Ordu and his team six months to do a forensic audit on the financial position.

    “Forensic audit would be carried out on the corporate governance failures observed in the course of reviewing the financial statement of the company,” Salami said.

  • Brokers hail NAICOM for abolishing annual licence renewal

    The President, Nigeria Council of Registered Insurance Brokers (NCRIB), Mr Kayode Okunoren, has applauded the National Insurance Commission (NAICOM) for considering abolishing annual renewal of brokers’ licence.

    Okunoren made the commendation in an interview with the News Agency of Nigeria (NAN) in Lagos on Friday.

    The NCRIB boss said that the council had been calling for the abolition, and expressed the hope that it would give insurance business a boost.

    Okunoren, however, urged the NAICOM to consider life licensing for brokers or a five-year licence renewal.

    “We praise NAICOM for abolishing the annual renewal.

    “Let NAICOM consider five-year or life licensing regime.

    NAN reports that NAICOM had at the 2017 National Insurance Conference in Abuja recently, said that it resolved to extend the brokers’ licence renewal period.

    Mr Sunday Thomas, the NAICOM Deputy Commissioner for Insurance (Technical), who made this known, said that the process of annual renewal of the licence had become cumbersome.

    Thomas had said: “NAICOM is ready to make changes where necessary. Life licensing for brokers may not be possible for now, but there are challenges in the annual licence renewal.

    “We can consider a licensing system that has a longer life span.” (NAN)

  • NAICOM releases draft revised guidelines for Micro Insurance Operations

    The National Insurance Commission (NIACOM) says it has released a draft revised guidelines for Micro Insurance Operations in the country.

    Mr Rasaaq Salami, the Head, Corporate Affairs of NAICOM said this in a statement on Friday in Abuja.

    Salami said that the draft revised guidelines had been released to the market for inputs by stakeholders.

    “The guidelines have already been sent to chief executive officers of all insurance and reinsurance companies.

    “They include Nigerian Insurance Association, Nigerian Council Registered Insurance Brokers, Enhancing Financial Innovation and Access for their various inputs.

    “All parties have until July 24 to forward their inputs to the commission,’’ he said.

    TheNewsGuru.com reports that micro insurance is a type of insurance that is usually accessed by low-income earners in the society.

    The aim of the product is to ensure everybody is included and to increase the contribution of insurance to the country’s Gross Domestic Product.

    It is also aimed at ensuring that insurance is known in all the nooks and crannies of the country.

    NAICOM rolled out the guidelines on micro insurance to enable intermediaries to sell micro insurance in the sector.

    The guidelines will guide intermediaries such as service providers, NGOs, trade associations among others that want to sell micro insurance products.

  • NAICOM approves financial statements of 32 insurance firms, pends 9

    The National Insurance Commission (NAICOM) on Tuesday said it had approved 32 out of 41 firms’ 2016 financial statements submitted to it.

    The Head, Corporate Affairs of NAICOM, Mr Rasaaq Salami, told the News Agency of Nigeria (NAN) in Lagos that nine others had queries and the commission was awaiting the response of the affected companies.

    He said reports that the commission was delaying clearance of insurance firms’ financial statements was untrue.

    Salami said the onus was on the affected companies to reply to the queries raised so that they could complete the process of getting the approvals.

    “What do you expect? NAICOM is not a rubber stamp commission. Once the financial account of any insurance company meets the required standard, it will be approved.

    “The commission has approved over 32 firms’ financial statements out of 57 insurance companies in the country.

    “So far, 41 companies have submitted their financial accounts and out of the 41, 32 companies’ financial statements have been approved by the commission.

    “The other insurance companies’ financial statements have not been approved because some have been queries and a response to the queries is being awaited,” Salami said.

    The NAICOM official said some of the companies also had the habit of submitting their accounts very late.

    NAN reports that some insurance companies had informed their shareholders that they were unable to file their audited financial statements to the Nigerian Stock Exchange because they were awaiting NAICOM approval.

    NAICOM is the apex body established to regulate and supervise the Nigerian insurance sector.

    The commission’s regulation requires insurance firms to submit their financial statements on or before March 31.

    The Insurance Act imposes a daily fine of N5,000 on firms that fail to meet the March 31 deadline for the submission of their accounts.

    The commission, in the past, had vowed to implement relevant measures to discourage companies from filing late returns and sanction errant ones appropriately.

    It said actions to be taken include a detailed review of their accounting and financial reporting systems and restriction of certain activities until relevant returns are filed, among others.

  • We assist companies comply with insurance laws – NAICOM

    The National Insurance Commission (NAICOM) says it is playing its role in ensuring that insurance companies comply with the set rules and laws of the industry.

    Mr Ahmad Adamu, Deputy Director, Enforcement and Compliance, NAICOM said this in an interview with the News Agency of Nigeria (NAN) in Abuja on Monday.

    “We have been of much assistance to the insurance companies to ensure that they comply because it is not just an issue of enforcement.

    “As a sensible regulator, compliance means that you ensure that people are enlightened, they know the required legal expectations of them and you also assist them.

    “And when you do this, those that are penalised for failure to comply will know that you have done your beat as a regulator.’’

    On enlightenment, Adamu said the commission already had a document that contained all the legal requirements that would be compiled in form of a booklet.

    “This will be distributed to operators and other stakeholders to ensure seamless compliance.

    “We also engage managements of the companies to arrive at a satisfactory conclusion when necessary.

    “If you have issues and we write to you saying that you have been penalised and you come up with your defence which seem not to be understood by us, we invite you to explain.

    “We invite all the staff of the unit, we all engage in a discussion and try to understand ourselves from proper point of view and that helps a lot.”

    According to Adamu, we are guided by the provision of the law in all we do.

    “We try to give all the companies fair hearing, we established an affiliate jurisdiction that will review cases in the commission.

    “The affiliate jurisdiction also has what we call “supreme court Exco” made up of Technical (Insurance) heads, Accountants, Lawyers and so on,’’ he said.

    He said that the effort of the commission was yielding results as the level of compliance by insurance companies had increased tremendously in the past year.

    “Our compliance dashboard is showing that people are getting more circumspect in what they do because it is no longer business as usual

    “Now if you commit any offence in a department and you require regulatory approval, clearance or renewal of licence from another department, you cannot get it.

    “It has become a cycle here because no insurance firm can now by-pass any department to obtain an approval.

    “This is because the department must seek and get clearance from all the directorates before such an approval is made.

    “So the fact that a company knows it must need one or two things from the regulator which the regulator is not likely to grant because of its failure to comply with a certain rule elsewhere.

    “This has now enhanced the level of compliance a great deal.”

     

    NAN