Annuitants of African Alliance Insurance Company have called for a clear timetable on when they should expect their first payment after months of non-payment.
An annuitant is a person who receives regular payments from an annuity contract. The annuity contract requires payments for more than one year. The amount of the monthly payments an annuitant receives is based on their age and life expectancy.
Speaking on behalf of other annuitants, an NTA Contributory Pensioner, Gbadebo Olatokunbo, made this demand in a chat with The PUNCH on Sunday.
The National Insurance Commission dismissed the board and management of African Alliance Insurance Company on Wednesday and appointed an interim board/management led by Dr Haruna Mustapha as Chairman and Mr Jacob Erhabor as Managing Director.
The Commissioner for Insurance, Olusegun Omosehin, said, “The new board is tasked with managing the affairs of the company and, above all, ensuring the interests of policyholders, particularly annuitants, are safeguarded.”
Speaking on the development, Olatokunbo said, “It was a welcome development, even if it came too late; because many annuitants of AAI were in disarray since the stoppage of their monthly payment over six months ago. I must be blunt with you that NAICOM was too slow in responding to the plights of AAI annuitants, despite the repeated coverage of the annuity plight by the media.
“A regulator must be very proactive in issues of such nature. Now that NAICOM has acted, there are still no direct directives on when we poor AAI-Annuities should be expecting payments, almost everything still looks like a dream to us, we thought that after this very long delay in payment, we would have been told when next to expect our first payment.
“Promises make no sense to us anymore, the ideal thing now is to give us a timetable on our outstanding arrears and the necessary information on the way forward, because NAICOM has known of our plights with AAI for months before it became public knowledge.”
He went on to appeal for speedy payment of annuity.
At the briefing where the sack of the board was announced, the CFI mentioned the valuation of the assets of the company.
“So, the quick things they need to do, one of them is to quickly do a valuation of the portfolio, and by so doing, also do a quick assessment of the available assets and how they can quickly convert those assets to liquidity. Some of them are easy to convert, and their prospects of being converted are high because some of those assets are very lucrative. It’s just the will to make it happen. And those are things the board had been mandated to do, convert those assets to liquid assets to support these liabilities that are on the ground,” Omosehin asserted.
Meanwhile, an Associate Professor of Insurance at the Lagos State University, Dr Olufemi Abass, in his comments stated that the decision taken by NAICOM was a foregone conclusion, only a matter of when it would happen.
“It was a decision that I knew was going to happen. It was a matter of when it would happen and not if it would happen. It was obvious that African Alliance has shown symptoms of financial ailment and is unable to meet its obligation as an insurance company.
“It is a step in the right direction, especially to safeguard public confidence. It is a welcome development and I wish the interim board and management well. I wish that they could quickly arrest the situation to avoid a further dent in the reputation of the insurance industry. NAICOM should look deeper. While I’m not an insider, I can sense a failure in corporate governance.”
On insurance firms that are struggling, Abass affirmed that the move by NAICOM would make them put their houses in order.
“There are quite a few insurance companies that are struggling but that doesn’t mean the situation cannot be salvaged. I like the bold step taken by the CFI because it shows that there are no sacred cows. All the struggling insurance companies will have to find a way to stay afloat. If not, now that the CFI has started to wield the big stick, they know that if they do not sit right, they may also be affected,” he posited.
A senior lecturer in the Department of Actuarial Science and Insurance, University of Lagos, Dr Jide Fadun, echoing similar sentiments said, “Sacking of African Alliance Board and Management by NAICOM has significant implications for the insurance industry and the nation. It is an indication of a good corporate governance framework in the Nigeria insurance industry.”
