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Chuks Udo Okonta
A Legal Practitioner and the Executive Director, Centre For Pension Right Advocacy, Ivor Takor, has lauded the steps taken by the National Insurance Commission (NAICOM) and National Pension Commission (PenCom) in addressing challenging clogging the marketing of Retiree Life Annuity (RLA) and Programmed Withdrawal (PW).
Takor told Inspenonline that the steps taken by the two regulators will help strengthen and promote both businesses.
“As a member of the Fola Adeola-led Pension Reform Committee, whose work ushered in the CPS through the Pension Reform Act 2004, I was quietly happy that Annuity was being sold to employees as it will give them an option, which was the spirit behind the provisions of Section 7(1) (b) and (c). However, I was very worried about the misinformation the marketers were dishing out with regards to the life span of programmed withdrawal.
“We were being told that PW ends after 15 years. How they arrived at that conclusion, I don’t know except that it was strategy to de-market PW. This discussion will not delve into the high and low points of either PW or RLA,” he said.
PenCom and NAICOM in a document recently issued which was entitled: Revised Regulation on Retirement Life Annuity Pursuant to the Pension Reform Act (PRA) 2014, has said reported and investigated cases of unfair and unethical practices, such as misinformation, de-marketing and mis-selling by Pension Fund Administrators (PFAs) and Retirement Life Annuity (RLA) Providers (Life insurance Operators) shall henceforth attract severe sanctions.
The regulators stated that any retirement life annuity provider who violates the regulation shall be subject to such penalty as may be prescribed by NAICOM from time to time.
They insisted that consistent violation of the regulation shall constitute a ground for suspension of the retirement life annuity provider from underwriting new businesses until the infractions are addressed.
According to them, where a violation adversely affects payment of monthly or quarterly annuity to a retiree(s), NAICOM shall impose appropriate regulatory sanctions on the retirement life annuity provider.
Any insurance agent who violates provisions of the regulation shall be sanctioned appropriately by NAICOM, both parties agreed.
They also posited that all infractions and violations by pension fund administrators and retirement life annuity custodians shall be determined and enforced in line with the regime of sanctions made pursuant to the PRA 2014 as prescribed by PenCom from time to time.
The regulators said all infractions and violations by RLA providers and insurance brokers/agents shall be subject to such penalties as may be prescribed by NAICOM from time to time.