Sunday Ojeme
Following the suspension of the boards of NICON Insurance Plc and that of Nigeria Reinsurance Corporation, the National Insurance Commission said on Saturday that the decision was taken in the interest of stakeholders.
The Head of the Corporate Affairs unit of the regulatory agency, Mr. Mike Umeh, said in a statement that the action was intended to protect all stakeholders especially the policyholders, who continued to petition the NAICOM for non-settlement of genuine claims, which also affected some government parastatals.
“To ensure equity, all such petitions were referred to NICON Insurance for response. Regrettably, most of these enquiries were either not responded to or received late with evasive responses,” he said.
He said the commission also discovered that the respective chief executive officers of life and general businesses in the oganisations were mere paper executives that could only approve payments of up to N50,000 while payments above this amount were the exclusive preserve of the group managing director, thereby rendering the CEOs ineffective and incapable of taking decisions on prompt claims payment which is the principal objective of taking an insurance policy.
He said o Investments, the NAICOM also confirmed information regarding movements of investment in a manner not consistent with the Insurance Act.
According to him, “By a letter conveying the instructions of the Group Managing Director, all monies realised by NICON Insurance and Nigeria Reinsurance Corporation in excess of that immediately required for salaries and other management expenses, were domiciled with a company registered as NICON Investment Company Limited. This company is solely owned by the Group Managing Director and cheques for such accounts domiciled with him.”
He said in respect of Nigeria Re, evidences of a cowed management abound with instructions dished out and compliance compelled, saying that this was certainly against the norms and dictum of good corporate governance and established practice in an insurance institution.
He said, “The board of directors is the highest decision making organ of any corporate organisation and should have the freedom to arrive at relevant decisions. It may be noted that the Federal Government still has substantial equity in the two organisations under reference. In the case of NICON Insurance Corporation, not less than 30 per cent and in the case of Nigeria-Re, not less than 70 per cent. It is therefore unacceptable to allow these institutions to be run unethically with very disturbing consequences on policyholders, investors, the insurance industry and the economy at large.”
Sunday Ojeme
International Energy Insurance Plc has unveiled a new auto insurance package, which it considers a deviation from the conventional cover currently on offer.
Speaking via a statement on the new scheme tagged “IEI AutoCare” the Managing Director of IEI, Mr. Jacob Erhabor, said “Consumer expectation is very dynamic and we have to be sensitive to it, because it is basically why we are in business. This is where we make a world of difference from the rest. This is just the beginning of what is shortly going to be a series in innovative and value-adding product development from the stables of this vibrant and caring insurance company.”
The statement said the package, apart from the promise to provide a brand new replacement car for the beneficiary, also offered a stop-gap provision for the customer, in which a chauffeur-driven car would be provided as soon as the company was notified of a claim in case of an accident.
It also covers riot, strike and civil commotion, at no extra cost to the insured, besides the fact that it is a policy-excess free cover. The idea is to up the value proposition of the cover for the policyholder.
The Group Head, Business Development, Mr. Akinwale Akinsola, said “For most businesses, even start ups, and in our personal lives, the car has become very essential, and it would do a lot of good if one’s life or business is not grounded just because the unexpected happened.”
IEI AutoCare cover in two categories including the Deluxe and the Executive. The Deluxe offers a package for personal accident treatment, irrespective of the cover for the repair of damages on the car involved, free vehicle recovery offer via a tracker or replacement in case of total loss, and tyre sealant among other benefits.
The Executive category has additional benefits with the provision of a chauffeur-driven car as a stop-gap in the event of a loss or accident, riot, strike and civil commotion cover while also enjoying excess-free payment for damages.
In the Deluxe package, designed for vehicles valued between N3m and N5m, the express benefits for the policyholder include free personal accident cover valued at N1m apart from the free vehicle tracker/recovery services attached. There is a free tyre sealant offer involved before the ultimate benefit of having the car replaced in case of a total loss during the incident.
Values attached to the Executive category, essentially designed for vehicles worth in excess of N5m include getting a free chauffer-driven car as replacement, payment of damages incurred in the process of the accident - without limit. The tyre sealant, vehicle tracker and personal accident cover of N1m on the insured offer, also applies as in the case for the Deluxe category.
Oceanic Health plans community insurance programme
Sunday Ojeme
The Group Managing Director of Oceanic Insurance Group, Prince Lafor Olateru-Olagbegi, has said that the Oceanic Health Management Plans has finalized plans to
introduce a robust Community Health Insurance programme aimed at promoting effective primary healthcare delivery services in Nigeria
He said in a statement on Saturday that the company would provide technical support and human capital development structures to drive primary health care delivery across the various states of the federation through the programme.
Olagbegi spoke on behalf of the Oceanic Group Chairman, Dr. (Mrs.) Cecelia Ibru, at a workshop in Ibadan which focused on ways Oceanic Health could partner with the Oyo State Council on Health at ensuring qualitative health services are available, accessible and affordable to the vulnerable and socially excluded in the state.
He said that the health insurance would play a frontline role in efforts geared towards improving the quality of life of residents of rural areas, orphans, retirees, the unemployed, and prison inmates, among others.
According to him, “Health insurance is a veritable way of providing social protection against poverty. Oceanic Health is committed to partnering with Oyo State and other states of the federation to ensure hitch-free implementation of the National Health Insurance Scheme at all levels of healthcare in Nigeria by building effective and enduring technical and human capacity structures.”
The features of the partnership include, upgrade of community primary health centres, training community health workers to manage them, emphasis on primary care and referrals, incorporation of private health facilities, introduction of local scheme administrators, and affiliation to secondary care providers.
Identifying poor infrastructure, inadequate personnel and low government expenditure as factors that had stunted healthcare development in Nigeria, he said there was need for global best practices in healthcare financing in Nigeria.
He said, “There is need to ensure more equity, technical quality, reliability and support preventive measures, and rational use of resources.”
Oceanic Health Management Limited, a subsidiary of Oceanic Bank International Plc, was incorporated on January 19, 2007 to carry on the business of primary, secondary, and tertiary health management services in Nigeria . The company is manned by topflight health and other professionals led by its chief executive officer, Dr. Nte Uran-York.
First Guarantee tasks states on pension reforms
Sunday Ojeme
The Managing Director of First Guarantee Pension Limited, Mr. Charles Nwachukwu, has advised state governors to embrace the new pension regime in order to allow for a smooth implementation.
In a statement on Friday, he said there was need for state governments to embrace the scheme by first enacting the necessary statutory requirements and also stipulating the guidelines for the smooth operation of the scheme in their various domains.
He commended the Ogun State Government for embracing the scheme, saying it had done very well in providing the enabling environment that would ensure a resounding success of the scheme in the state.
He said First Guarantee Pension was poised to comply with all the necessary conditions and guidelines as stipulated by the state government.
The Ogun State Commissioner for Finance, Mr Kehinde Sogunle, said that the enactment of the Ogun State Pension Law 2006, the engagement of a firm of consulting actuaries to valuate the past benefits of workers and the creation of pension bureaux attested to the state government’s commitment to the success of the scheme.
While recognising the freedom of workers in the state to patronise any PFA of their choice, he noted that it was the responsibility of the state government to guide its workers aright.
According to him, “The interest of our workers is paramount to the state government vis-à-vis the determination of the calibre of the managers of the pension assets”.
He pointed out that the selected PFAs underwent rigorous screening exercise including being made to make presentations before the State Technical Committee on Contributory Pension Scheme and interactions with a view to determining the best method(s) that assured hitch-free implementation of the scheme.
He made it clear that the ceremony marked the formal commencement of the scheme in the state.
He said any registration of workers made earlier by any PFA was unacceptable to the state government as uncoordinated registration had the potential of engendering loss of workers’ confidence in the scheme.
He said the state government had directed the National Pension Commission to disregard all purported registrations carried out by any PFA on behalf of Ogun State public service workers.
Aiico wins NSE president award
Sunday Ojeme
Aiico Insurance Plc last week emerged the winner of the 2007 edition of the Nigerian Stock Exchange President’s Merit Award for the insurance sector.
A statement on Friday said the company’s emergence as a winner for the third time confirmed the performance of its stocks on the floor of the NSE, thus signifying the good managerial skills of the management and the board.
The statement said Aiico would be going to the market soon to raise N10bn, through a combination of public offer and rights issue.
The Chairman of the company, Chief (Dr.) Dele Fajemirokun, had expressed confidence at the annual general meeting that that the company was on the right path in terms of strategic posturing and business focus. According to him, “Our projections indicate positive growth in all areas and we are committed to succeeding. Looking ahead, we see brighter opportunities for continued strong and profitable growth and as things now stand, we are well positioned to enhance sustainable growth and improve shareholders returns”.
He said Aiico would place strong emphasis on strategic execution of the aforementioned, in order to realise the expected gains efficiently and effectively.
The company’s five-year result shows profit before tax at N348.80bn in 2006 as against N86.95bn in year 2005, representing 301.6 per cent growth while the profit after tax rose by 491 per cent, from N81.81m in 2005 to N483.70m in 2006.
The investment income increased by 335.4 per cent, moving from N20.89m in March of the 2005 to N90.95m in the current financial year.
The company also took a leap from its earning per share of six kobo, recorded in 2005 to 13 kobo in the current financial year, indicating a growth of 117 per cent and its shareholders fund appreciated by 37 per cent from N4.27bn to N5.87bn.
The company’s first quarter result ending March 2007 has shown a modest performance with premium income moving up to N753m from N726m as against the first quarter results in the year 2006, Profit after tax closed at N82.29m compared to N31.71m in 2006.
Asset base, however, dropped by 19 per cent, from N10.73bn in 2005 to N8.70bn at the end of 2006 financial year.
This according to the company was as a result of transfer of about N2bn worth of assets to its pension subsidiary, Aiico Pension Managers Limited.
Tuesday 20 November 2007
NIA declines comment on NICON, Nigeria Re
Sunday Ojeme
The Nigeria Insurers Association has said that it will not comment on the takeover of one of its member companies, NICON Insurance Plc, by the Federal Government for now until it has studied the situation properly.
Speaking with our correspondent on Saturday, the Head, Corporate Affairs, NIA, Mr. Davis Iyasere, said only the National Insurance Commission could take a position on the matter for now, adding, however, that NIA would make its position known on the matter as events unfolded
Expressing gratitude to the federal government over the release of the recapitalisation funds held in an escrow account with the Central Bank of Nigeria since the exercise ended 10 months ago, he said the body had already congratulated its member companies that made the list after the long and tortuous journey.
“We also commend the government for taken such a step especially as regards the release of the trapped funds in an escrow account with the Central Bank of Nigeria,” he said.
The federal government, through the Minister of State for Finance, Mr. Remi Babalola, on Wednesday released the list of insurance companies adjudged successful during the recapitalisation programme. He also promised to effect the immediate release of the recapitalisation funds held in an escrow account to the various companies.
The government approved the issuance of final licenses to 48 insurance companies and one reinsurer.
Babalola said the funds estimated at over N80bn would be released to enable the companies operate their business.
He said the actions were taken in consultation with the President and the Attorney-General of the Federation and Minister of Justice.
He said the measures were part of government’s efforts to remove the insurance sector from its globally insignificant and underdeveloped stage.
The release of the funds and the list of the successful companies have brought to an end the harrowing experience, which the operators had gone through for almost 28 months since the federal government directed them to shore up their capital base to N2bn for life, N3bn for general and N10bn for reinsurance.
The programme, however, ended on a sad note when a former Minister of Finance, Mrs Nenadi Usman, set up a panel to verify the exercise as well as investigate the activities of the former Commissioner for Insurance, Chief Emmanuel Chukwulozie, who supervised the programme.
Not satisfied with the constitution of the panel and the call to appear before it, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, went to court to seek an injunction stopping the federal government from interfering with the management of NICON and others he took over during the recapitalisation exercise as well as stopping the implementation of the report of the technical committee on the verification exercise.
The court case further heightened tension in the industry until last week when Babalola ordered the release of the list and the funds as well as the dissolution of the boards of NICON and Nigeria Re.
According to the NIA spokesman, the development as regards the list and the funds is a positive one for the industry and hopefully, operators can now begin to invest their money as well as go into various expansion plans.
He said member companies had been directed to go to the CBN to access the fund, adding that no company had gone and reported back that it had not been able to access the funds.
The Nigeria Insurers Association has said that it will not comment on the takeover of one of its member companies, NICON Insurance Plc, by the Federal Government for now until it has studied the situation properly.
Speaking with our correspondent on Saturday, the Head, Corporate Affairs, NIA, Mr. Davis Iyasere, said only the National Insurance Commission could take a position on the matter for now, adding, however, that NIA would make its position known on the matter as events unfolded
Expressing gratitude to the federal government over the release of the recapitalisation funds held in an escrow account with the Central Bank of Nigeria since the exercise ended 10 months ago, he said the body had already congratulated its member companies that made the list after the long and tortuous journey.
“We also commend the government for taken such a step especially as regards the release of the trapped funds in an escrow account with the Central Bank of Nigeria,” he said.
The federal government, through the Minister of State for Finance, Mr. Remi Babalola, on Wednesday released the list of insurance companies adjudged successful during the recapitalisation programme. He also promised to effect the immediate release of the recapitalisation funds held in an escrow account to the various companies.
The government approved the issuance of final licenses to 48 insurance companies and one reinsurer.
Babalola said the funds estimated at over N80bn would be released to enable the companies operate their business.
He said the actions were taken in consultation with the President and the Attorney-General of the Federation and Minister of Justice.
He said the measures were part of government’s efforts to remove the insurance sector from its globally insignificant and underdeveloped stage.
The release of the funds and the list of the successful companies have brought to an end the harrowing experience, which the operators had gone through for almost 28 months since the federal government directed them to shore up their capital base to N2bn for life, N3bn for general and N10bn for reinsurance.
The programme, however, ended on a sad note when a former Minister of Finance, Mrs Nenadi Usman, set up a panel to verify the exercise as well as investigate the activities of the former Commissioner for Insurance, Chief Emmanuel Chukwulozie, who supervised the programme.
Not satisfied with the constitution of the panel and the call to appear before it, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, went to court to seek an injunction stopping the federal government from interfering with the management of NICON and others he took over during the recapitalisation exercise as well as stopping the implementation of the report of the technical committee on the verification exercise.
The court case further heightened tension in the industry until last week when Babalola ordered the release of the list and the funds as well as the dissolution of the boards of NICON and Nigeria Re.
According to the NIA spokesman, the development as regards the list and the funds is a positive one for the industry and hopefully, operators can now begin to invest their money as well as go into various expansion plans.
He said member companies had been directed to go to the CBN to access the fund, adding that no company had gone and reported back that it had not been able to access the funds.
Post-consolidation: Afribank boss urges insurers to learn from banks
Sunday Ojeme
The Group Managing Director, Afribank Nigeria Plc, Mr. Sebastine Adigwe, has advised operators in the insurance industry to learn the post-consolidation ropes from the banking sector. He said the greatest thing that a post consolidated Nigerian insurance industry could benefit from the experience of the banking sector was the way and manner post-consolidation challenges were tackled.
Delivering his lecture at the 11th edition of the Champion Insurance Day/Luncheon in Lagos on Tuesday, he said just like the way it was for the banking sector, the consolidation of the insurance industry was designed to tackle all the institutional problems that made it difficult for the sub-sector to make desirable positive impacts and support the growth and development of the economy.
He said there was no doubt that the Nigerian insurance industry had a lot to learn from the experience of banking consolidation for its own consolidation to achieve the desired goals.
According to him, “It can easily avoid some of the unexpected challenges of the banking experience and with the benefit of hindsight, proactive steps can be taken to ensure that the gains already recorded are sustained and other milestones are achieved as soon as possible.”
He said it must be appreciated that the attainment of post-consolidation goals required the cooperation, trust and faith of all stakeholders, saying that the institutionalisation of sound corporate governance and appropriate regulatory oversight were very important.
Speaking on the post-consolidation challenges, he said major board and management challenges lay in the composition of board and management for the merged institutions as well as the adoption of appropriate organisational structure, adding that one of the first critical issues to be addressed post-consolidation was the strategy for the new company.
“It will be necessary to give appropriate direction through development of vision, mission, and core values as well as corporate strategy. The issue here is in defining a new strategic thrust which requires timely communication to all members of staff to ensure their buy-in as well as mobilise them towards the company’s new direction.”
He said branding was particularly necessary where some of the legacy companies had experienced business problems and that the branding effort, which is aimed at regaining customers’ confidence, was also important.
Earlier in his opening remark, the Chairman of Niger Insurance Plc, Alhaji Bala Zakariya’u, who was represented by the Managing Director, Mr. Clinton Uranta, said the issue of corporate governance and capital growth in the industry should be taken more seriously.
He said the sector was frozen for a long period until the government found it necessary to intervene through a raise in the capital base and integration into the global financial sector.
He said, “We will soon see a new insurance industry that will act as a catalyst to the economy. All we need is the right people. We have to continue to build quality and capacity.”
The Group Managing Director, Afribank Nigeria Plc, Mr. Sebastine Adigwe, has advised operators in the insurance industry to learn the post-consolidation ropes from the banking sector. He said the greatest thing that a post consolidated Nigerian insurance industry could benefit from the experience of the banking sector was the way and manner post-consolidation challenges were tackled.
Delivering his lecture at the 11th edition of the Champion Insurance Day/Luncheon in Lagos on Tuesday, he said just like the way it was for the banking sector, the consolidation of the insurance industry was designed to tackle all the institutional problems that made it difficult for the sub-sector to make desirable positive impacts and support the growth and development of the economy.
He said there was no doubt that the Nigerian insurance industry had a lot to learn from the experience of banking consolidation for its own consolidation to achieve the desired goals.
According to him, “It can easily avoid some of the unexpected challenges of the banking experience and with the benefit of hindsight, proactive steps can be taken to ensure that the gains already recorded are sustained and other milestones are achieved as soon as possible.”
He said it must be appreciated that the attainment of post-consolidation goals required the cooperation, trust and faith of all stakeholders, saying that the institutionalisation of sound corporate governance and appropriate regulatory oversight were very important.
Speaking on the post-consolidation challenges, he said major board and management challenges lay in the composition of board and management for the merged institutions as well as the adoption of appropriate organisational structure, adding that one of the first critical issues to be addressed post-consolidation was the strategy for the new company.
“It will be necessary to give appropriate direction through development of vision, mission, and core values as well as corporate strategy. The issue here is in defining a new strategic thrust which requires timely communication to all members of staff to ensure their buy-in as well as mobilise them towards the company’s new direction.”
He said branding was particularly necessary where some of the legacy companies had experienced business problems and that the branding effort, which is aimed at regaining customers’ confidence, was also important.
Earlier in his opening remark, the Chairman of Niger Insurance Plc, Alhaji Bala Zakariya’u, who was represented by the Managing Director, Mr. Clinton Uranta, said the issue of corporate governance and capital growth in the industry should be taken more seriously.
He said the sector was frozen for a long period until the government found it necessary to intervene through a raise in the capital base and integration into the global financial sector.
He said, “We will soon see a new insurance industry that will act as a catalyst to the economy. All we need is the right people. We have to continue to build quality and capacity.”
NICON takeover: NAICOM hinges decision on stakeholders’ interest
Sunday Ojeme
Following the suspension of the boards of NICON Insurance Plc and that of Nigeria Reinsurance Corporation, the National Insurance Commission said on Saturday that the decision was taken in the interest of stakeholders.
The Head of the Corporate Affairs unit of the regulatory agency, Mr. Mike Umeh, said in a statement that the action was intended to protect all stakeholders especially the policyholders, who continued to petition the NAICOM for non-settlement of genuine claims, which also affected some government parastatals.
“To ensure equity, all such petitions were referred to NICON Insurance for response. Regrettably, most of these enquiries were either not responded to or received late with evasive responses,” he said.
He said the commission also discovered that the respective chief executive officers of life and general businesses in the oganisations were mere paper executives that could only approve payments of up to N50,000 while payments above this amount were the exclusive preserve of the group managing director, thereby rendering the CEOs ineffective and incapable of taking decisions on prompt claims payment which is the principal objective of taking an insurance policy.
He said o Investments, the NAICOM also confirmed information regarding movements of investment in a manner not consistent with the Insurance Act.
According to him, “By a letter conveying the instructions of the Group Managing Director, all monies realised by NICON Insurance and Nigeria Reinsurance Corporation in excess of that immediately required for salaries and other management expenses, were domiciled with a company registered as NICON Investment Company Limited. This company is solely owned by the Group Managing Director and cheques for such accounts domiciled with him.”
He said in respect of Nigeria Re, evidences of a cowed management abound with instructions dished out and compliance compelled, saying that this was certainly against the norms and dictum of good corporate governance and established practice in an insurance institution.
He said, “The board of directors is the highest decision making organ of any corporate organisation and should have the freedom to arrive at relevant decisions. It may be noted that the Federal Government still has substantial equity in the two organisations under reference. In the case of NICON Insurance Corporation, not less than 30 per cent and in the case of Nigeria-Re, not less than 70 per cent. It is therefore unacceptable to allow these institutions to be run unethically with very disturbing consequences on policyholders, investors, the insurance industry and the economy at large.”
Following the suspension of the boards of NICON Insurance Plc and that of Nigeria Reinsurance Corporation, the National Insurance Commission said on Saturday that the decision was taken in the interest of stakeholders.
The Head of the Corporate Affairs unit of the regulatory agency, Mr. Mike Umeh, said in a statement that the action was intended to protect all stakeholders especially the policyholders, who continued to petition the NAICOM for non-settlement of genuine claims, which also affected some government parastatals.
“To ensure equity, all such petitions were referred to NICON Insurance for response. Regrettably, most of these enquiries were either not responded to or received late with evasive responses,” he said.
He said the commission also discovered that the respective chief executive officers of life and general businesses in the oganisations were mere paper executives that could only approve payments of up to N50,000 while payments above this amount were the exclusive preserve of the group managing director, thereby rendering the CEOs ineffective and incapable of taking decisions on prompt claims payment which is the principal objective of taking an insurance policy.
He said o Investments, the NAICOM also confirmed information regarding movements of investment in a manner not consistent with the Insurance Act.
According to him, “By a letter conveying the instructions of the Group Managing Director, all monies realised by NICON Insurance and Nigeria Reinsurance Corporation in excess of that immediately required for salaries and other management expenses, were domiciled with a company registered as NICON Investment Company Limited. This company is solely owned by the Group Managing Director and cheques for such accounts domiciled with him.”
He said in respect of Nigeria Re, evidences of a cowed management abound with instructions dished out and compliance compelled, saying that this was certainly against the norms and dictum of good corporate governance and established practice in an insurance institution.
He said, “The board of directors is the highest decision making organ of any corporate organisation and should have the freedom to arrive at relevant decisions. It may be noted that the Federal Government still has substantial equity in the two organisations under reference. In the case of NICON Insurance Corporation, not less than 30 per cent and in the case of Nigeria-Re, not less than 70 per cent. It is therefore unacceptable to allow these institutions to be run unethically with very disturbing consequences on policyholders, investors, the insurance industry and the economy at large.”
Thursday 15 November 2007
NICON takeover: Ibrahim threatens N10bn suit against FG
Sunday Ojeme
Following the seizure of NICON Insurance Plc and the dissolution of the board of Nigeria Reinsurance Corporation by the Federal Government, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, has advised his lawyer to institute a suit against the government over the action.
He is asking for N10bn for damages.
Addressing journalists in Lagos on Thursday, he said his lawyers had the brief to commence forthwith committal to prison proceeding against the government officials involved including the Attorney-General of the Federation and the Minister of State for Finance.
He said the matter in respect of NICON and Nigeria Re was currently before a Federal High Court and that the court had granted three different injunctions restraining the Federal Government from taking over or interfering with the running and affairs of the two companies until the determination of the case.
He described the Attorney General of the Federation, Mr. Mr. Michael Andoaaka, who authorised the constitution of the interim management for the companies and the Minister of State for Finance, Mr. Remi Babalola, as lawless.
The NICON boss who acquired about 70 per cent stake in the two firms during the privatisation of the companies handled by the Bureau of Public Enterprises said he would begin the legal process of committing the two government officials into prison for their ‘illegal’ actions on Friday.
Vowing that the board of the companies would meet in Abuja on Monday, Ibrahim said the Federal Government had no power to dissolve the board and management of the insurance companies.
He said the federal government was represented by two learned Senior Advocates of Nigeria who had not succeeded in vacating the court order as the case had been adjourned to November 29. He said the federal government took executive decision to overrule the court order and ordered a takeover of a private company.
According to him, “If the Attorney-General does not understand the meaning of injunction, at least, he must have heard about the doctrine of lespendence. If he thinks this will divert attention from his Economic and Financial Crimes Commission syndrome, then we shall teach him the law. We never had it so bad in our country where an Attorney-General celebrates controversies at the expense of clear laws in Nigeria.”
He said it was interesting to note that the Minister of State for Finance made the order for himself when he is not the regulator of the insurance industry. He said this was one case of executive lawlessness, which equaled the violation of the constitution of Nigeria being witnessed in a democratic government whose first priority was to obey court orders.
He decried a situation where the premises of both organisations were sealed off with about 50 policemen, adding that since the privatization of NICON, the management had not received any query from the government and that the performance and turnaround efforts had been a clear case of facts speaking for itself.
He said, “Our entire group is in employment of over 8000 Nigerians. The government of Nigeria should be grateful to me and not to seal our business premises with mobile policemen with AK47 riffle when we did not commit any crime.
“We are law abiding citizens and we shall follow the law to the letter. If the government finds pleasure in disobeying court orders, we, as individuals shall obey all court orders.
Babalola had on Wednesday announced the sack of board of NICON and Nigeria Re following the refusal of the two companies to submit for post consolidation verification.
According to him, members of Interim Management Committee would be announced in few days.
Following the seizure of NICON Insurance Plc and the dissolution of the board of Nigeria Reinsurance Corporation by the Federal Government, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, has advised his lawyer to institute a suit against the government over the action.
He is asking for N10bn for damages.
Addressing journalists in Lagos on Thursday, he said his lawyers had the brief to commence forthwith committal to prison proceeding against the government officials involved including the Attorney-General of the Federation and the Minister of State for Finance.
He said the matter in respect of NICON and Nigeria Re was currently before a Federal High Court and that the court had granted three different injunctions restraining the Federal Government from taking over or interfering with the running and affairs of the two companies until the determination of the case.
He described the Attorney General of the Federation, Mr. Mr. Michael Andoaaka, who authorised the constitution of the interim management for the companies and the Minister of State for Finance, Mr. Remi Babalola, as lawless.
The NICON boss who acquired about 70 per cent stake in the two firms during the privatisation of the companies handled by the Bureau of Public Enterprises said he would begin the legal process of committing the two government officials into prison for their ‘illegal’ actions on Friday.
Vowing that the board of the companies would meet in Abuja on Monday, Ibrahim said the Federal Government had no power to dissolve the board and management of the insurance companies.
He said the federal government was represented by two learned Senior Advocates of Nigeria who had not succeeded in vacating the court order as the case had been adjourned to November 29. He said the federal government took executive decision to overrule the court order and ordered a takeover of a private company.
According to him, “If the Attorney-General does not understand the meaning of injunction, at least, he must have heard about the doctrine of lespendence. If he thinks this will divert attention from his Economic and Financial Crimes Commission syndrome, then we shall teach him the law. We never had it so bad in our country where an Attorney-General celebrates controversies at the expense of clear laws in Nigeria.”
He said it was interesting to note that the Minister of State for Finance made the order for himself when he is not the regulator of the insurance industry. He said this was one case of executive lawlessness, which equaled the violation of the constitution of Nigeria being witnessed in a democratic government whose first priority was to obey court orders.
He decried a situation where the premises of both organisations were sealed off with about 50 policemen, adding that since the privatization of NICON, the management had not received any query from the government and that the performance and turnaround efforts had been a clear case of facts speaking for itself.
He said, “Our entire group is in employment of over 8000 Nigerians. The government of Nigeria should be grateful to me and not to seal our business premises with mobile policemen with AK47 riffle when we did not commit any crime.
“We are law abiding citizens and we shall follow the law to the letter. If the government finds pleasure in disobeying court orders, we, as individuals shall obey all court orders.
Babalola had on Wednesday announced the sack of board of NICON and Nigeria Re following the refusal of the two companies to submit for post consolidation verification.
According to him, members of Interim Management Committee would be announced in few days.
Tuesday 13 November 2007
CIIN tasks insurance managers on competence
The President of the Chartered Insurance Institute of Nigeria, Mr. Adeyemo Adejumo, has advised managers in the insurance sector to continually upgrade themselves in order to face the dynamic challenges in the industry.
Speaking in Kano at 2007 Annual Education Seminar of CIIN, he said today’s insurance managers as a whole should be actively engaged in skills redefinition and the reappraisal of operational strategies in all ramifications of insurance practice.
According to him, “Managers ought to continually explore the depths of their technical competencies with a view to evolving rapid and progressive changes capable of buoying profit margins as well as ensuring effective service delivery.”
He said the Governing Council of CIIN had accepted the huge challenge of re-inventing human capital development to match the post-consolidation requirements of the insurance sector and also ratified a new policy aimed at compelling employers in the insurance industry to include training and retraining as an integral part of their employment package to ensure that employees enjoy trainings sponsored by their employers, not as a benefit, but as right to a healthy work life.
According to him, “We however realise how difficult it could be convincing some employers that the training and retraining of their workforce is a compelling need which must be addressed as a priority. The Governing Council has therefore ratified a ratings formula which will operate as a quarterly or yearly score card showing where insurance companies stand in the degree and extent of training opportunities to which they expose their staff. It is our firm belief that human capital growth and development would occupy the pride of place in management agenda in the new dispensation.”
Expressing gladness over the inauguration of the Governing Board of the College of Insurance and Financial Management, he said it was a step in the direction of actualising the College project and providing more ample opportunities for insurance education in Nigeria.
He said, “It is pertinent to state that the evolving branch network in our industry is a critical factor in the effective retailing of insurance products and services. It is therefore necessary to fully equip insurance branch managers for the enormous task of managing the branch offices effectively while ensuring the growth of grassroots patronage of insurance products to guarantee returns on the huge shareholders funds.”
He said although a capital intensive project, the College venture would require the concerted efforts of industry stakeholders who are equal to the task, saying that the composition of the College Board was a reflection of the entire industry and, expectedly, should provide the impetus for unmitigated joint action.
Speaking further, he said the education seminar was coming at a critical time, when the industry was being faced with the challenges of forging a common front to uphold issues of common interest.
He said, “As is now common knowledge, the recapitalisation and consolidation exercise has witnessed some complications which, undoubtedly, have slowed down the full actualisation of the reform process. I am, however, satisfied with the painstaking efforts of key stakeholders in resolving the impasse. In particular, we appreciate the intervention of the industry elders who have held regular consultations and made useful contributions to the peace process.”
He said the industry was passing through a remarkable phase in its development and that as a group, the operators should spare no efforts in contributing their utmost to the evolving process.
“The recapitalisation and consolidation exercise has, no doubt, strengthened our operational base with more than N200bn aggregate capitalisation and the evolution of mega insurance institutions capable of playing beyond the Nigerian shores,” he said.
Speaking in Kano at 2007 Annual Education Seminar of CIIN, he said today’s insurance managers as a whole should be actively engaged in skills redefinition and the reappraisal of operational strategies in all ramifications of insurance practice.
According to him, “Managers ought to continually explore the depths of their technical competencies with a view to evolving rapid and progressive changes capable of buoying profit margins as well as ensuring effective service delivery.”
He said the Governing Council of CIIN had accepted the huge challenge of re-inventing human capital development to match the post-consolidation requirements of the insurance sector and also ratified a new policy aimed at compelling employers in the insurance industry to include training and retraining as an integral part of their employment package to ensure that employees enjoy trainings sponsored by their employers, not as a benefit, but as right to a healthy work life.
According to him, “We however realise how difficult it could be convincing some employers that the training and retraining of their workforce is a compelling need which must be addressed as a priority. The Governing Council has therefore ratified a ratings formula which will operate as a quarterly or yearly score card showing where insurance companies stand in the degree and extent of training opportunities to which they expose their staff. It is our firm belief that human capital growth and development would occupy the pride of place in management agenda in the new dispensation.”
Expressing gladness over the inauguration of the Governing Board of the College of Insurance and Financial Management, he said it was a step in the direction of actualising the College project and providing more ample opportunities for insurance education in Nigeria.
He said, “It is pertinent to state that the evolving branch network in our industry is a critical factor in the effective retailing of insurance products and services. It is therefore necessary to fully equip insurance branch managers for the enormous task of managing the branch offices effectively while ensuring the growth of grassroots patronage of insurance products to guarantee returns on the huge shareholders funds.”
He said although a capital intensive project, the College venture would require the concerted efforts of industry stakeholders who are equal to the task, saying that the composition of the College Board was a reflection of the entire industry and, expectedly, should provide the impetus for unmitigated joint action.
Speaking further, he said the education seminar was coming at a critical time, when the industry was being faced with the challenges of forging a common front to uphold issues of common interest.
He said, “As is now common knowledge, the recapitalisation and consolidation exercise has witnessed some complications which, undoubtedly, have slowed down the full actualisation of the reform process. I am, however, satisfied with the painstaking efforts of key stakeholders in resolving the impasse. In particular, we appreciate the intervention of the industry elders who have held regular consultations and made useful contributions to the peace process.”
He said the industry was passing through a remarkable phase in its development and that as a group, the operators should spare no efforts in contributing their utmost to the evolving process.
“The recapitalisation and consolidation exercise has, no doubt, strengthened our operational base with more than N200bn aggregate capitalisation and the evolution of mega insurance institutions capable of playing beyond the Nigerian shores,” he said.
Ogun pays N5bn pension in four years
The Governor of Ogun State, Otunba Gbenga Daniel, has said that the state government paid out a total of N5bn as pension in the past four years, according to a statement on Saturday.
Speaking while presenting letters of endorsement to sixteen Pension Fund Administrators that would be recommended to workers in the Ogun State Public Service, he said the state government serviced its pension liabilities with N110m on a monthly basis.
He said the issue of pension in Ogun State had a terrible history and had been as inconveniencing to the state government as it was to the retirees themselves.
He said that the figures continued to rise as more people retired, saying that the situation informed the state government’s excitement about the new scheme.
He said that there won’t be any impediments to the remission of pension funds as contributions would be made in tandem with payment of salaries.
In his remark, the Managing Director of First Guarantee Pension Limited, Mr. Charles Nwachukwu, advised other state governors to embrace the new pension regime in order to allow for a smooth implementation.
He commended the government of Ogun State for taking full charge of activities with regard to the implementation of the new contributory pension scheme in the state, adding that if other states in the federation followed in the footsteps of Ogun, the new pension scheme would enjoy a smooth sail.
He noted that there was need for state governments to embrace the scheme by first enacting the necessary statutory requirements and also stipulating the guidelines for the smooth operation of the scheme in their various domains, adding that the Ogun State Government had done very well in providing the enabling environment that would ensure a resounding success of the scheme in the state.
He said First Guarantee Pension was poised to comply with all the necessary conditions and guidelines as stipulated by the state government.
The Ogun State Commissioner for Finance, Mr Kehinde Sogunle, said that the enactment of the Ogun State Pension Law 2006, the engagement of a firm of consulting actuaries to valuate the past benefits of workers and the creation of pension bureaux attested to the state government’s commitment to the success of the scheme.
While recognising the freedom of workers in the state to patronise any PFA of their choice, he noted that it was the responsibility of the state government to guide its workers aright.
According to him, “The interest of our workers is paramount to the state government vis-à-vis the determination of the calibre of the managers of the pension assets”.
He pointed out that the selected PFAs underwent rigorous screening exercise including being made to make presentations before the State Technical Committee on Contributory Pension Scheme and interactions with a view to determining the best method(s) that assured hitch-free implementation of the scheme.
He made it clear that the ceremony marked the formal commencement of the scheme in the state.
He said any registration of workers made earlier by any PFA was unacceptable to the state government as uncoordinated registration had the potential of engendering loss of workers’ confidence in the scheme.
He said the state government had directed the National Pension Commission to disregard all purported registrations carried out by any PFA on behalf of Ogun State public service workers.
Speaking while presenting letters of endorsement to sixteen Pension Fund Administrators that would be recommended to workers in the Ogun State Public Service, he said the state government serviced its pension liabilities with N110m on a monthly basis.
He said the issue of pension in Ogun State had a terrible history and had been as inconveniencing to the state government as it was to the retirees themselves.
He said that the figures continued to rise as more people retired, saying that the situation informed the state government’s excitement about the new scheme.
He said that there won’t be any impediments to the remission of pension funds as contributions would be made in tandem with payment of salaries.
In his remark, the Managing Director of First Guarantee Pension Limited, Mr. Charles Nwachukwu, advised other state governors to embrace the new pension regime in order to allow for a smooth implementation.
He commended the government of Ogun State for taking full charge of activities with regard to the implementation of the new contributory pension scheme in the state, adding that if other states in the federation followed in the footsteps of Ogun, the new pension scheme would enjoy a smooth sail.
He noted that there was need for state governments to embrace the scheme by first enacting the necessary statutory requirements and also stipulating the guidelines for the smooth operation of the scheme in their various domains, adding that the Ogun State Government had done very well in providing the enabling environment that would ensure a resounding success of the scheme in the state.
He said First Guarantee Pension was poised to comply with all the necessary conditions and guidelines as stipulated by the state government.
The Ogun State Commissioner for Finance, Mr Kehinde Sogunle, said that the enactment of the Ogun State Pension Law 2006, the engagement of a firm of consulting actuaries to valuate the past benefits of workers and the creation of pension bureaux attested to the state government’s commitment to the success of the scheme.
While recognising the freedom of workers in the state to patronise any PFA of their choice, he noted that it was the responsibility of the state government to guide its workers aright.
According to him, “The interest of our workers is paramount to the state government vis-à-vis the determination of the calibre of the managers of the pension assets”.
He pointed out that the selected PFAs underwent rigorous screening exercise including being made to make presentations before the State Technical Committee on Contributory Pension Scheme and interactions with a view to determining the best method(s) that assured hitch-free implementation of the scheme.
He made it clear that the ceremony marked the formal commencement of the scheme in the state.
He said any registration of workers made earlier by any PFA was unacceptable to the state government as uncoordinated registration had the potential of engendering loss of workers’ confidence in the scheme.
He said the state government had directed the National Pension Commission to disregard all purported registrations carried out by any PFA on behalf of Ogun State public service workers.
Oceanic Health plans community insurance programme
Sunday Ojeme
The Group Managing Director of Oceanic Insurance Group, Prince Lafor Olateru-Olagbegi, has said that the Oceanic Health Management Plans has finalized plans to
introduce a robust Community Health Insurance programme aimed at promoting effective primary healthcare delivery services in Nigeria
He said in a statement on Saturday that the company would provide technical support and human capital development structures to drive primary health care delivery across the various states of the federation through the programme.
Olagbegi spoke on behalf of the Oceanic Group Chairman, Dr. (Mrs.) Cecelia Ibru, at a workshop in Ibadan which focused on ways Oceanic Health could partner with the Oyo State Council on Health at ensuring qualitative health services are available, accessible and affordable to the vulnerable and socially excluded in the state.
He said that the health insurance would play a frontline role in efforts geared towards improving the quality of life of residents of rural areas, orphans, retirees, the unemployed, and prison inmates, among others.
According to him, “Health insurance is a veritable way of providing social protection against poverty. Oceanic Health is committed to partnering with Oyo State and other states of the federation to ensure hitch-free implementation of the National Health Insurance Scheme at all levels of healthcare in Nigeria by building effective and enduring technical and human capacity structures.”
The features of the partnership include, upgrade of community primary health centres, training community health workers to manage them, emphasis on primary care and referrals, incorporation of private health facilities, introduction of local scheme administrators, and affiliation to secondary care providers.
Identifying poor infrastructure, inadequate personnel and low government expenditure as factors that had stunted healthcare development in Nigeria, he said there was need for global best practices in healthcare financing in Nigeria.
He said, “There is need to ensure more equity, technical quality, reliability and support preventive measures, and rational use of resources.”
Oceanic Health Management Limited, a subsidiary of Oceanic Bank International Plc, was incorporated on January 19, 2007 to carry on the business of primary, secondary, and tertiary health management services in Nigeria . The company is manned by topflight health and other professionals led by its chief executive officer, Dr. Nte Uran-York.
The Group Managing Director of Oceanic Insurance Group, Prince Lafor Olateru-Olagbegi, has said that the Oceanic Health Management Plans has finalized plans to
introduce a robust Community Health Insurance programme aimed at promoting effective primary healthcare delivery services in Nigeria
He said in a statement on Saturday that the company would provide technical support and human capital development structures to drive primary health care delivery across the various states of the federation through the programme.
Olagbegi spoke on behalf of the Oceanic Group Chairman, Dr. (Mrs.) Cecelia Ibru, at a workshop in Ibadan which focused on ways Oceanic Health could partner with the Oyo State Council on Health at ensuring qualitative health services are available, accessible and affordable to the vulnerable and socially excluded in the state.
He said that the health insurance would play a frontline role in efforts geared towards improving the quality of life of residents of rural areas, orphans, retirees, the unemployed, and prison inmates, among others.
According to him, “Health insurance is a veritable way of providing social protection against poverty. Oceanic Health is committed to partnering with Oyo State and other states of the federation to ensure hitch-free implementation of the National Health Insurance Scheme at all levels of healthcare in Nigeria by building effective and enduring technical and human capacity structures.”
The features of the partnership include, upgrade of community primary health centres, training community health workers to manage them, emphasis on primary care and referrals, incorporation of private health facilities, introduction of local scheme administrators, and affiliation to secondary care providers.
Identifying poor infrastructure, inadequate personnel and low government expenditure as factors that had stunted healthcare development in Nigeria, he said there was need for global best practices in healthcare financing in Nigeria.
He said, “There is need to ensure more equity, technical quality, reliability and support preventive measures, and rational use of resources.”
Oceanic Health Management Limited, a subsidiary of Oceanic Bank International Plc, was incorporated on January 19, 2007 to carry on the business of primary, secondary, and tertiary health management services in Nigeria . The company is manned by topflight health and other professionals led by its chief executive officer, Dr. Nte Uran-York.
Saturday 3 November 2007
NEM promises investors good ROI
The Managing Director of NEM Insurance Plc, Mr. Tope Smart, has said that the underwriting firm was on the path of rewarding its shareholders with good returns on investments.
In a statement on Friday, he said NEM had completed its integration processes culminating in the precipitation of a hybrid insurance company with above industry average core competences.
NEM Insurance is a product of a merger with Vigilant Insurance. The company is currently trading with shareholders fund in excess of N3.2bn.
.The statement said NEM’s shares have been very active and on the top gainers chart in the insurance sub sector at the Nigerian Stock Exchange, a development which has made its shares one of the most sort after.
According to the managing directro “The recapitalisation, rejuvenation and re-branding of NEM Insurance are stories of success. I will tell the shareholders that it was time for harvest. NEM has a new software, which has enabled us to speed up our operations and processes. Our service delivery and response time are now faster and better and this is more evident in our claims processing and payment targets.”
Giving an insight into the company’s claims profile, he said the company had paid claims totaling N289m during the third quarter of the year.
He said the improvement in the company’s branch net work coupled with the autonomy enjoyed by the branch managers had helped in ensuring bigger business penetration and better response time.
He said, “All our clients are impressed with our performance and this is translating into bigger patronage by way of referrals and recommendations. NEM is one company with a very rich history, it has good will and it has maintained it focus. The dividends of the company’s recapitalisation are becoming more manifest.”
He said NEM was certain to accomplish its 2007 premium projection of N2.5bn. since it had already grossed N1.6m in its first three months of operation this year.
In a statement on Friday, he said NEM had completed its integration processes culminating in the precipitation of a hybrid insurance company with above industry average core competences.
NEM Insurance is a product of a merger with Vigilant Insurance. The company is currently trading with shareholders fund in excess of N3.2bn.
.The statement said NEM’s shares have been very active and on the top gainers chart in the insurance sub sector at the Nigerian Stock Exchange, a development which has made its shares one of the most sort after.
According to the managing directro “The recapitalisation, rejuvenation and re-branding of NEM Insurance are stories of success. I will tell the shareholders that it was time for harvest. NEM has a new software, which has enabled us to speed up our operations and processes. Our service delivery and response time are now faster and better and this is more evident in our claims processing and payment targets.”
Giving an insight into the company’s claims profile, he said the company had paid claims totaling N289m during the third quarter of the year.
He said the improvement in the company’s branch net work coupled with the autonomy enjoyed by the branch managers had helped in ensuring bigger business penetration and better response time.
He said, “All our clients are impressed with our performance and this is translating into bigger patronage by way of referrals and recommendations. NEM is one company with a very rich history, it has good will and it has maintained it focus. The dividends of the company’s recapitalisation are becoming more manifest.”
He said NEM was certain to accomplish its 2007 premium projection of N2.5bn. since it had already grossed N1.6m in its first three months of operation this year.
NICON pays N30m to SON pensioners
NICON Insurance Plc has paid pensioners who retired from the services of the Standards Organisation of Nigeria the sum of N30m as part of the company’s commitment to offset the pension liabilities in its book. NICON has set aside N6bn for 126 institutions.
The Oceanic Bank cheque was received by a representative of the pensioners, Mr. S.A Kadiri on Thursday at the Global Fleet office in Lagos.
Briefing journalists, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, said he was still committed to wiping the tears of pensioners who had suffered under the poor pension system in the country.
He said the company’s promise to payout all the pension liabilities was still ongoing, adding that any organization that had completed its reconciliation would be sure of receiving its payment.
Speaking with our correspondent, a beneficiary, Mr. Razak Shonibare, commended NICON for living up to its promises. He said the management of the SON and the governing council had met with NICON management over the issue a few months ago, adding that the meeting had yielded fruits.
SON is among the 126 institutional pensioners in the books of NICON expected to be cleared by the end of 2007.
According toIbrahim, "There is the need to involve the beneficiaries in the arrangement and order of payments. Our target at NICON is to reduce our pension liabilities. Before December, there will be no pension liability in our books and then, we will begin to consider the desirability of moving into Pension Funds Administration."
As the core investor in the insurance firm, he inherited a pension liability of N13bn.
He said, "The greatest problem of NICON was the pension. We want to demonstrate quality leadership in the direction of claims payment and make Nigerians repose confidence in NICON.”
The Oceanic Bank cheque was received by a representative of the pensioners, Mr. S.A Kadiri on Thursday at the Global Fleet office in Lagos.
Briefing journalists, the Group Managing Director, NICON Group of Companies, Mr. Jimoh Ibrahim, said he was still committed to wiping the tears of pensioners who had suffered under the poor pension system in the country.
He said the company’s promise to payout all the pension liabilities was still ongoing, adding that any organization that had completed its reconciliation would be sure of receiving its payment.
Speaking with our correspondent, a beneficiary, Mr. Razak Shonibare, commended NICON for living up to its promises. He said the management of the SON and the governing council had met with NICON management over the issue a few months ago, adding that the meeting had yielded fruits.
SON is among the 126 institutional pensioners in the books of NICON expected to be cleared by the end of 2007.
According toIbrahim, "There is the need to involve the beneficiaries in the arrangement and order of payments. Our target at NICON is to reduce our pension liabilities. Before December, there will be no pension liability in our books and then, we will begin to consider the desirability of moving into Pension Funds Administration."
As the core investor in the insurance firm, he inherited a pension liability of N13bn.
He said, "The greatest problem of NICON was the pension. We want to demonstrate quality leadership in the direction of claims payment and make Nigerians repose confidence in NICON.”
Special risks: Capacity, expertise pose challenges
Sunday Ojeme
The insurance industry moved a step further in Lagos on Friday when the Lagos Business School in partnership with Mutual Benefits Assurance Plc organised a round table to explore ways for operators to benefit from the much talked about special risks underwriting.
Ever since the Federal Government pronounced recapitalisation for the industry and the attendant 40 per cent local content promise, insurance operators, either by sheer seriousness or mere propaganda, have been at their best in trying to convince investors of their readiness to partake in the oil, gas and aviation cover.
With the belief that participating in special risks remains the cash cow to grow their premium and profits, attention has been shifted to activities that will ensure the opportunity does not elude them.
To prepare themselves, some companies have either created or re-energised the oil and gas units in their organizations as well as sending some of their workers abroad for training in that area.
In spite of the efforts on the part of the operators, experts are still of the opinion that the required capacity and expertise to underwrite risks in the special risks sectors are still far from what operators in those sectors are looking for.
The roundtable, which attracted representatives from the Nigerian National Petroleum Corporation, insurance brokers, business managers and teachers as well as insurers, provided opportunities for the speakers to tackle issues that are likely to pose challenges to the underwriters in their bid to have a bite on the juicy pie.
It was also meant to formulate an agenda that will see insurers coming together in a consortium with a very high capacity and expertise to get involved in the special risks cover without much ado.
Setting the ball rolling, the Chairman of Mutual Benefits, Chief Chamberlain Oyibo, said in the last 50 years there had been a disconnect between the production of oil in the country and some sectors of the economy, especially the financial sector. He said it was commendable that in the last eight years the government had deemed it necessary to provide a platform where a number of sectors could tap into the huge profits made from the oil sector.
According to him, “The financial sector should be involved in the huge profits made by the oil and gas industry. There is a lot of business for insurance in the oil and gas sector. We believe that if the insurance sector keys into oil and gas, jobs will be created for the economy and manufacturing, which is the biggest employer of labour will thrive.”
In his submission, Prof. Pat Utomi lamented the status of insurance practice in the country, saying in the developed world, insurers actually determine how and what a company should go.
He said although the industry was gradually overcoming the human capital and financial challenges with the current reforms, the NNPC still had a great role to play in driving local content, adding that capital that built a country was usually made from home.
Expounding the benefits and possible challenges, the Managing Director of Mutual Benefits, Mr. Akin Ogunbiyi, gave a detailed analysis of the financial operations of the operators involved in the oil and gas sector as well as what insurers could benefit from giving them cover.
Describing the roundtable as a turning-point to the economy and a good opportunity to interact and come up with a positive strategy for the insurance industry, he said with the value of assets in the special risks sector, there was no reason why the insurance industry should not be the mover of the economy, saying that the bulk of insurable assets were still being taken abroad.
Throwing the challenges of capacity and expertise before his colleagues, he queried their ability to underwrite special risks, adding that in spite of the hiccups in the sector serious companies were still emerging.
He said that qualified manpower was required in the industry. He urged the operator, the government and regulators to come together to improve on the human capital through the institution of a college of insurance to train young graduates.
Giving analysis of the estimated asset value of operators in the oil and gas sector, he put the value of onshore and offshore assets of the NNPC at $28bn, Shell,/SPDC, $7bn including the Bonga project, Cheveron/Texaco, $4bn, Elf/Total, $3bn and Agip/AOEN, $2.8bn.
For ExxonMobil, he put the value at $5.4bn, Addax Petroleum, $278m, Pan Ocean, $38m and NLNG, $5bn.
He said majority shares of the above assets were either covered in the international market with traditional insurers or under their captive accounts.
According to him, “The reinsurers in Europe will not give reinsurance security in form of oil treaty because they fear accumulation of risks which cannot be recompensed by the good experience of other locations as local insurers lack international spread.”
He added that most of the insurers did not have the oil and gas reinsurance treaty to guaranty their acceptance and that the technical expertise to handle the underwriting complexities of the oil and gas risks was limited. He pointed out that enough technical reserves had not been accumulated to sustain the cash intensive claims perculiar to the oil and gas industry.
Speaking on the efforts so far made by the NNPC at harmonizing the the local content agenda for the benefit of the insurers, a representative from the corporation, Mr. Ernest Nwapa, wondered if the insurers were actually prepared to tap into the oil and gas sector.
He decried the self-centred attitude of the operators, saying that such an attitude had been responsible for the failure of several proposed consortia in the past.
Speaking on the national content development imperative, he said the model focused on domiciliation but underpinned with a requirement to transfer ownership of assets to Nigerian subsidiary in the case of multi-national companies.
He said the local content campaign should not be seen from the angle of indigenization but from that of domiciliation to build global collaboration, attract foreign direct investment, promote technology transfer as well as for local value addition.
He said that all the guidelines that were developed in respect of oil and gas insurance were done in collaboration with the National Insurance Commission and other stakeholders, adding that an average growth rate of 55 per cent per annum in proportion of insurance was placed locally.
The insurance industry moved a step further in Lagos on Friday when the Lagos Business School in partnership with Mutual Benefits Assurance Plc organised a round table to explore ways for operators to benefit from the much talked about special risks underwriting.
Ever since the Federal Government pronounced recapitalisation for the industry and the attendant 40 per cent local content promise, insurance operators, either by sheer seriousness or mere propaganda, have been at their best in trying to convince investors of their readiness to partake in the oil, gas and aviation cover.
With the belief that participating in special risks remains the cash cow to grow their premium and profits, attention has been shifted to activities that will ensure the opportunity does not elude them.
To prepare themselves, some companies have either created or re-energised the oil and gas units in their organizations as well as sending some of their workers abroad for training in that area.
In spite of the efforts on the part of the operators, experts are still of the opinion that the required capacity and expertise to underwrite risks in the special risks sectors are still far from what operators in those sectors are looking for.
The roundtable, which attracted representatives from the Nigerian National Petroleum Corporation, insurance brokers, business managers and teachers as well as insurers, provided opportunities for the speakers to tackle issues that are likely to pose challenges to the underwriters in their bid to have a bite on the juicy pie.
It was also meant to formulate an agenda that will see insurers coming together in a consortium with a very high capacity and expertise to get involved in the special risks cover without much ado.
Setting the ball rolling, the Chairman of Mutual Benefits, Chief Chamberlain Oyibo, said in the last 50 years there had been a disconnect between the production of oil in the country and some sectors of the economy, especially the financial sector. He said it was commendable that in the last eight years the government had deemed it necessary to provide a platform where a number of sectors could tap into the huge profits made from the oil sector.
According to him, “The financial sector should be involved in the huge profits made by the oil and gas industry. There is a lot of business for insurance in the oil and gas sector. We believe that if the insurance sector keys into oil and gas, jobs will be created for the economy and manufacturing, which is the biggest employer of labour will thrive.”
In his submission, Prof. Pat Utomi lamented the status of insurance practice in the country, saying in the developed world, insurers actually determine how and what a company should go.
He said although the industry was gradually overcoming the human capital and financial challenges with the current reforms, the NNPC still had a great role to play in driving local content, adding that capital that built a country was usually made from home.
Expounding the benefits and possible challenges, the Managing Director of Mutual Benefits, Mr. Akin Ogunbiyi, gave a detailed analysis of the financial operations of the operators involved in the oil and gas sector as well as what insurers could benefit from giving them cover.
Describing the roundtable as a turning-point to the economy and a good opportunity to interact and come up with a positive strategy for the insurance industry, he said with the value of assets in the special risks sector, there was no reason why the insurance industry should not be the mover of the economy, saying that the bulk of insurable assets were still being taken abroad.
Throwing the challenges of capacity and expertise before his colleagues, he queried their ability to underwrite special risks, adding that in spite of the hiccups in the sector serious companies were still emerging.
He said that qualified manpower was required in the industry. He urged the operator, the government and regulators to come together to improve on the human capital through the institution of a college of insurance to train young graduates.
Giving analysis of the estimated asset value of operators in the oil and gas sector, he put the value of onshore and offshore assets of the NNPC at $28bn, Shell,/SPDC, $7bn including the Bonga project, Cheveron/Texaco, $4bn, Elf/Total, $3bn and Agip/AOEN, $2.8bn.
For ExxonMobil, he put the value at $5.4bn, Addax Petroleum, $278m, Pan Ocean, $38m and NLNG, $5bn.
He said majority shares of the above assets were either covered in the international market with traditional insurers or under their captive accounts.
According to him, “The reinsurers in Europe will not give reinsurance security in form of oil treaty because they fear accumulation of risks which cannot be recompensed by the good experience of other locations as local insurers lack international spread.”
He added that most of the insurers did not have the oil and gas reinsurance treaty to guaranty their acceptance and that the technical expertise to handle the underwriting complexities of the oil and gas risks was limited. He pointed out that enough technical reserves had not been accumulated to sustain the cash intensive claims perculiar to the oil and gas industry.
Speaking on the efforts so far made by the NNPC at harmonizing the the local content agenda for the benefit of the insurers, a representative from the corporation, Mr. Ernest Nwapa, wondered if the insurers were actually prepared to tap into the oil and gas sector.
He decried the self-centred attitude of the operators, saying that such an attitude had been responsible for the failure of several proposed consortia in the past.
Speaking on the national content development imperative, he said the model focused on domiciliation but underpinned with a requirement to transfer ownership of assets to Nigerian subsidiary in the case of multi-national companies.
He said the local content campaign should not be seen from the angle of indigenization but from that of domiciliation to build global collaboration, attract foreign direct investment, promote technology transfer as well as for local value addition.
He said that all the guidelines that were developed in respect of oil and gas insurance were done in collaboration with the National Insurance Commission and other stakeholders, adding that an average growth rate of 55 per cent per annum in proportion of insurance was placed locally.
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