2 hours ago
5
…police, army, civil servants affected
The House of Representatives yesterday directed its Committee on Insurance and Actuarial Matters to conduct a forensic investigation into over N30 billion unsettled group life insurance claims affecting the Nigeria Police Force, Head of Service, and the Ministry of Defence.
The decision followed the adoption of a motion titled “Breaches and Other Infractions by Some Federal Government Institutions on Insurance and Actuarial Matters Using Forensic Auditors,” sponsored by Sulaiman Gumi.
Presenting the motion, Gumi expressed concerns over unsettled claims attributed to the lack of actuarial valuations, gap analyses, and non-compliance with key legal provisions, including Section 57 of the Insurance Act, 2023, and Section 4(5) of the Pension Reform Act, 2014, among others. He said: “The House is deeply concerned about the lack of transparency and accountability in Nigeria’s insurance practices.
This has led to over ₦30 billion in unsettled claims for group life insurance policies covering the Nigeria Police Force, the Office of the Head of the Civil Service (for federal civil servants), and the Ministry of Defence (for the Nigerian Armed Forces).
“These unresolved claims can be attributed to the absence of actuarial valuations, failure to conduct gap analyses, and non-compliance with key legislative provisions, including Section 57 of the Insurance Act, 2023, and Section 4, Subsection 5 of the Pension Reform Act, 2014, among other factors.
“We are aware that over $1 billion that should have been retained in Nigeria if all insurance practitioners are given the option of the right of first refusal (insurance being more about risk bearing and sharing) is being taken abroad, which affects the nation’s economy, thereby always weakening our insurance sector and depleting our foreign reserve.
“These breaches and infractions have given rise to excessive cession and retrocession of businesses in breach of the Local Content Act to the extent that 90 per cent of the risks of some federal government organisations are placed outside the country.”
He noted that this development had caused untold hardship for millions of families of deceased Federal Government personnel, who are the rightful beneficiaries. “These families have been left to suffer because they have not received the entitlements of their breadwinners,” he said.
He enumerated several challenges militating against the insurance industry noting that conventional insurance is hampered by outdated laws, a shortage of professional loss adjusters, irregular payment of loss adjusters’ fees, and the non-remittance of premiums, particularly to reinsurers.
He further pointed out the lack of innovation, inconsistent government policies, and insufficient cooperation within the industry.
These issues, compounded by poor governance and weak regulatory oversight stemming from obsolete laws, have contributed significantly to the collapse of many financial institutions, especially microfinance banks, Gumi observed.
Please follow and like us:
