Santions Awaits MDAs Over Uninsured Assets As More Insurance Firms Fear Liquidation

By LOVETH AZODO, Lagos

The Commissioner for Insurance, Sunday Thomas has said that the Ministries, Departments and Agencies (MDAs) of Federal Government that fail to insure its assets, risk being sanctioned, by the time the proposed guidelines on insurance of government assets become operational.

This is just as he threatened that more insurance companies may lose their operational certificates as part of moves to sanitise the industry.

The Commissioner for Insurance, Sunday Thomas made the revelation while speaking at the second edition of the Chartered Insurance Institute of Nigeria, (CIIN) Business Outlook Seminar, Thursday in Lagos. He delivered a paper titled: “The Regulator’s Perspective of the Theme paper”

Thomas, who was represented by the Deputy Commissioner, Technical, Sabiu Abubakar, said the National Insurance Commission (NAICOM), would be issuing the guidelines on insurance of government assets very soon, to ensure all assets of the government are adequately insured.

He said the commission has been collaborating with the Ministry of Finance, Secretary to the Government of the Federation and Head of Service, to come up with the guidelines.

According to him, the guidelines will ensure that all MDAs insure their assets as expected, pointing out that failure to do so, there will be sanction, even from the government.

“It is very worrisome to the Commission that most assets and liabilities of government are never adequately and appropriately insured, which further accentuated the need for urgent measures to be put in place by the Commission to ensure that government gets value for money in the purchase of insurance by MDAs.”

Speaking on liquidating more Insurance companies he noted that insurance regulation and supervision are always the bedrock of national economic development, stressing that he believed NAICOM’s reforms and regulatory initiatives will positively impact the insurance industry if achieved and that the Industry will witness tremendous development and growth.

“Recently two insurance companies’ licenses have been withdrawn and these are: Niger Insurance and Standard Alliance Insurance. Though managing the death/failure of financial institution is very demanding, nevertheless more may still be liquidated in order to sanitise the Insurance sectors,” he stated.

He urged insurance practitioners to remain complaints and support the Commission’s efforts.

While speaking on the International Financial Reporting Standards (IFRS17), he assured that the commission is not going back on the proposed implementation date of January 2023.

He added that the commission has set up sub-working groups to facilitate the migration, urging board members of each insurance firm to get prepared for the IFRS 17 implementation, especially as the deadline for migration was already at hand.

Also speaking, the President of CIIN, Edwin Igbiti, noted that the Business Outlook Seminar is a forum where key players in the insurance industry as well as the finance sub-sector of the economy converge to review the business environment in the country for the immediate past year and strategise on the way forward for the insurance industry in the new year.

He said the programme among other things, examines the national budget, reviews the thrusts of the fiscal and monetary policies of the government and estimate how these would influence the insurance industry in particular and the economy in general.