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Chuks Udo Okonta
The National Insurance Commission (NAICOM) has empowered actuaries in life insurance companies to enable the sector capture and manage huge chunk of expected inflow from the N14.43 trillion pension fund assets into retiree life annuity.
NAiCOM in its recently released Prudential Guidelines for Insurance Sector, stated that an insurer must ensure that the actuarial function has access to all relevant data, information, reports, and must take all reasonable steps to ensure access to all relevant service providers of the insurer, that its actuarial function reasonably believes are necessary to fulfil its responsibilities.
It noted that the Head of actuarial function should not hold positions within or outside of the insurer that may create conflicts of interest or compromise his or
her independence.
The insurance industry regulator also maintained that the Head of actuarial function has the obligation to notify the Commission if he or she resigns for reasons connected with his or her duties or with
the conduct of the insurer’s business and give the reasons for resigning.
It said the Head of actuarial function shall also notify the Commission and provide an explanation if his or her appointment is revoked by the insurer.
On external actuary, it noted that all insurers are required to send a profile of then external actuary to the Commission for approval not later than two months prior to the commencement of valuation, stressing that in addition, the submission shall contain evidence of registration with the Financial Reporting Council of Nigeria.
NAiCOM stated that the adequacy of the liabilities on both life and non-life insurance contracts shall be based on valuation carried out on annual basis by an actuary recognised by the Commission and registered with the Financial
Reporting Council.
On embedded values, it submitted that an insurer shall report on the financial condition of the company by including the embedded values as determined and certified by the external actuary by way of disclosure in the audited financial statements.
The Commissioner for Insurance Sunday Thomas, had at different fora said huge chunk of the pension fund assets would empty into the insurance industry due to the uniqueness of the retiree life annuity.
