Insurance World

AIICO Insurance Still Committed To Annuity Business * Eyes East/West Africa For Expansion Plans

BY NKECHI NAECHE–ESEZOBOR—AIICO Insurance Plc, a major player in Nigeria’s insurance sector has assured stakeholders that it’s still committed to doing annuity business.

The Managing Director/Chief Executive Officer, Mr Babatunde Fajemirokun disclosed this to BusinessToday Online on the sideline of just concluded African Insurance Organization (AIO) Conference, held recently in Lagos, Nigeria, that the company is still and will continue to write annuity business despite the competition in pricing.

According to him “We still writing annuity but as you already know annuity business is largely driven by price because there is a lot of competition in that area.”

He added that the new guidelines gave retirees one year to be able to transfer from their PFA to insurance company if they choose annuity.

In terms of pricing he said: “we alternate between second and fourth in pricing. Pricing moves all the time depending on the yields in the market. But unfortunately we don’t just want to do annuity purely on pricing alone we believe that there are other advantages that is provided to annuitants..

He reaffirmed that they will do a lot more in 2022, but this year they are just watching to see how things unfold.

On expansion plans he said they have revised their vision and in their vision one of the key things their board agreed with them was that they should look at sub-Sahara Africa not just focusing on Nigeria.

He said “one of our own view is that despite the fact that Nigeria have one of the lowest penetration rate in Africa we still believe that in terms of our business models to improve the level of diversification is important to look outside.

On the plans he said “We still very much at preliminary stages but we are reviewing other markets to see the opportunities for us to expand into those markets but we have not concluded yet.

He noted that “when we look at some of these other digital place that have come into Nigeria in digital banking at various other segments one of the reasons why they are getting the valuations that they are getting is because is an African thing. Looking at Africa diversify’s the business sufficiently to be able to command a premium on the value of the shares.

” If you look at markets such as Kenya, other markets in east Africa there is a lot of innovation going on in those markets. Kenya for instance has one of biggest in terms of digital instruments. It will be good to explore some of those types of opportunities in those markets.”

On Nigeria market, the AIICO boss said “Nigeria still have a long way to go if our regulators can agree in some of those aspects but for now we looking at East Africa, West Africa not really the North there are interesting opportunities that we are looking to explore but we have not confirmed whether we would.”

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