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The Nigerian Insurers Association (NIA) has concluded plans to engage a South African based Actuarial firm to help review annuity business and align it with current global market practices.
Its Chairman, Eddie Efekoha, who disclosed this at a media parley in Lagos, stated that The review and other assignments to be executed by the actuarial firm would be concluded in the first quarter of year 2017
“In its effort at promoting good order in the management of life annuity business in our market, the NIA has concluded plans to engage a South African based Actuarial firm to assist the Association review and advice on the current market practice leveraging global practices,” he said.
On the feud between insurers and the National Pension Commission (PenCom) over the transfer of annuity assets, he urged the National Insurance Commission (NAICOM) and PENCOM to urgently address the public and correct the bad impression created by the circular.
He said the circular was issued without due consultation, hence, has done so much damage to the life annuity market, stressing that operators of Life Annuity are being de-marketed by Pension Fund Administrators (PFAs).
“In its reaction to the circular, there was a meeting of CEOs of member companies to deliberate on the Circular and chart the way forward for the market. The Association has engaged NAICOM and stated its displeasure with the circular to PENCOM with copies made available to relevant government agencies,” he added.
In the retirement benefits business, Life insurance operators have continued to trail behind Pension Fund Administrators (PFAs) as retirees under Programmed Withdrawal (PW) stood at 132,405 and annuity 29,620 as at the end of March 2016.
PenCom said the total of retirees on PW increased from 126,775 in the fourth quarter, 2015 to 132,405 in the first quarter 2016, adding that the 5630 increase represented 4.44 per cent from the figure recorded in the previous quarter.
It noted that a sectoral breakdown of those retired under the PW showed that the public sector accounted for 71.74 per cent (4,039) of the total retirees on PW during the quarter, while the private sector recorded 28.28 per cent totaling 1,591 retirees.
PenCom noted that the lump sum withdrawals within the quarter stood at N12.63 billion, which cumulatively amounted to N329.38 billion from inception. It said an average of N4.36 billion was paid monthly to the retirees of the scheme as monthly PW as at the end of the reporting period.
The commission said it approved a total of 3,288 applications for annuity retirement plan during the quarter, bringing the total number of retirees receiving their retirement benefits through annuity plan to 29,620.
PenCom maintained that the 3,288 retirees received N3.96 billion as lump sum payment and paid annuity premium of N15.44 billion cumulating to a total of N41.85 billion and N145.05 billion as lump sum payment and annuity premium respectively.
The retirees, it said were receiving average monthly annuity of N1.51 billion as at the end of March 2016.