Insurance firms’ CEOs face sanctions

By IAfrica
In Nigeria
Jul 28th, 2014
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The fate of 13 chief executives of insurance companies and broking firms is hanging in the balance following their failure to submit their audited accounts to the National Insurance Commission (NAICOM).

For this breach, NAICOM has given the affected institutions a seven-day ultimatum to explain why they should not be sanctioned.

The affected CEOs are the Managing Directors of African Alliance Insurance, International Energy Insurance Plc, Industrial & General Insurance Plc, Capital Express Assurance Limited, Great Nigeria Insurance, NICON Insurance Limited, Nigerian Agricultural Insurance Corporation, Staco Insurance Plc, Standard Alliance Insurance Plc, UNIC Insurance Plc, Union Assurance Company Limited and Goldlink Insurance Plc.

Others are: Alliance & General Insurance, Allinace & General Life Assurance which has been under suspension since 2012,  Investment & Allied Insurance Plc and Spring Life Assurance Plc.

In a July 21 letter to the chief executive officers, NAICOM requested the 13 CEOs “to give acceptable explanations within seven days on why regulatory actions should not be taken against them for failing to submit their 2013 annual report as required by law”.

The seven-day ultimatum is with effect from July 21.

According to the memo, NAICOM stressed that it will be decisive on any of the CEO who fails within the stipulated seven-day period to explain why the sanction should not apply.

The Insurance Act 2003 mandates insurance companies to file their annual accounts, six months after the financial year.

The law for filing of annual returns and accounts states that “all insurance and re-insurance companies shall submit to the Commission three copies each of duly audited financial statements and annual returns in prescribed forms.

“In respect of operation of the company for 2010, returns shall be filed on, or before 30th June, 2011. Failure to file annual returns as prescribed by Section 26 of the Insurance Act, 2003 constitutes a ground for cancellation of operating licence.”

It states that “an insurer shall be deemed to have failed to file its annual returns if the provisions of Section 26 of the Insurance Act 2003, are not met 12 months after the end of the financial year. For purposes of compliance, accounting period shall run from 1st January to 31st December, 2010,” it added.

Last week, The Nation reported that NAICOM has stepped up its regulatory duties by releasing information on insurance companies’ financials to the public.

However, the Commission has not been able to provide data for 2012 and 2013 owing to late, or non-submission of some companies accounts since 2012.

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