Less than 70% of Life Companies are currently allowed to even go close to annuity – NAICOM
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Chuks Udo Okonta
Less than 70 per cent of Life Companies are currently allowed to even go close to annuity, the Deputy Commissioner for Insurance Technical Dr. Usman Jankara, has said.
He disclosed this yesterday on a Facebook engagement platform – Insurance Practitioners Forum in Nigeria, while speaking on what the National Insurance Commission (NAICOM) is doing to strengthen annuity business, amid prevailing challenges clogging the operations.
He noted that the sing song at the Commission relative to Annuity is now “Never Again…. Err on the side of caution.”.
According to him, to ensure there is no repeat of the “unsavoury experience” NAICOM has done the following.
“We have upscaled the regulatory requirements for Annuity. Not all life companies are currently allowed to transact annuity.
“We have issued additional requirement for Underwriting of Annuity. Which now ensure more robust monitoring of the pricing and ALM of RLAs.
“The Joint Regulation on Annuity is also being reviewed in collaboration with PenCom,'” h submitted.
Jankara said all the companies that are currently doing Annuity have consolidated the funds and kept them with Custodians.
He said NAICOM has placed prohibition orders on companies that have breached regulatory thresholds. Nipping a potential problem in bud and that less than 70 per cent of Life Companies are currently allowed to even go close to Annuity.
On the troubled companies, he said NAICOM’s intervention is yielding results and the commission is hopeful that the issues would be sorted out soon such that the unsavoury experience will soon be a matter of a terrible nightmare, that will lead to positive outcome for annuitants and claimants.
Naicom is always coming up with one policy or the other regarding insurance companies operating annuity policy without any positive results.
Annuitants are being owed six months of outstanding payments by some insurance companies, yet NAICOM is not seen to doing something positive to reduce the hardship of Annuitants.
Take the case of African Alliance Insurance. After NAICOM sacked the former board and management and appointed interim Board and Management in October 2024, nothing cheering is being done by the interim Board and Management. They are paying annuitants in bit and pieces instead of clearing the outstanding payments in bulk. Since they came on board, four months out of the outstanding was paid. After about three months, they paid two months. Now from November to December 2024 and January to April 2025, no payment to the annuitants. But they are paying themselves monthly salaries as and when due. NAICOM is watching this injustice without doing anything serious to alleviate the suffering of the annuitants.
Annuitants have complained and appealed to both the interim management and board to do something tangible but they remain less concerned.
I once again appeal to both of them to look into the matter of outstanding payments and let them clear it. Things are hard and unless you are out to strangulate and kill the annuitants, you should without delay pay them what is their legitimate annuity.
We look forward to a favourable consideration of this appeal.