BY NKECHI NAECHE- ESEZOBOR–In a bid to enshrine best practice in the management of annuity portfolios by insurance institutions, the National Insurance Commission (NAICOM), on Friday released four additional regulatory requirements for annuity business in Nigeria.
According to the commission this is aimed to ensuring a safe, sound, and stable insurance sector.
The commission in a circular, dated January 24, 2025, said the four new requirement are: qualified Actuary; ALM report; Regulatory Compliance and transfer of Annuity Portfolio.
According to the circular, insurance companies are required to have at least one qualified actuary responsible for Assets-Liability Matching (ALM) analysis and implementation.
They sre slso expected to submit ALM reports to the Commission quarterly,
with requirements outlined in the circular such as required actions by insurers depending on the results from specific analysis applying guidance provided in the NAS Standards of Actuarial Practice (NSAP).
It added that Insurance companies are required to comply with the new requirements, with the board of directors responsible for ensuring strict compliance.
It noted that companies that are unable to cover the additional expenses imposed by the circular are required to transfer their annuity portfolio to another suitable insurance company within 180 days.
The circular takes effect on February 1, 2025. Insurance companies are expected to comply with the new requirements to ensure a stable and secure annuity business in Nigeria.
