By Sola Alabadan
AIICO Insurance Plc is doing everything possible to deepen annuity business in order to take advantage of its inherent opportunities, the company’s managing director, Mr. Babatunde Fajemirokun, said.
Represented by the Head, Strategic Marketing and Communications, Mr. Segun Olalandu, the AIICO Insurance boss reiterated the company’s commitment to providing a robust annuity service that meets customers’ expectations, as well as drives the growth of insurance in the country.
While describing annuity business as a game changer for everybody, he assured that, the insurer is committed to a robust and effective Annuity service.
He noted that a lot still need to be done to deepen the business in
Nigeria, adding that “we are not there yet, but step by step, we will
Fajemirokun emphasised the importance of the collaboration between AIICO
Insurance and NAIPCO, saying: “our partnership with you as journalists, especially in respect of today’s training on Annuity is an indication of our commitment to the growth of this business.”
He said AIICO has strategically repositioned the Annuity department for
effectiveness and growth.
While thanking NAIPCO members for their supports so far, he charged them to make good use of the training to enrich their knowledge on annuity, share their experiences “so that when you are reporting on the subject matter, you will be able to tell the stories accurately.”
Speaking on the theme of the training:”Understanding Annuity Business,”, Senior Manager, Business Development, AIICO Insurance, Mr. Victor Owotorose, stressed the importance and benefits of annuity to the clients and the growth of insurance industry.
Annuities, he stated, are insurance contracts that promise to pay the policyholders regular income immediately or in the future.
According to him, a deferred annuity has an accumulation phase followed by a disbursement (annuitisation) phase; while an immediate Annuity converts a lump sum into cash flows from day one.
Owotorose said, annuity can be bought with either a lump sum or a
series of payments contributed over time, adding that, annuities come
in three main varieties—fixed, variable, and indexed—each with its own
level of risk and payout potentials.
The income receive from an annuity, he said, is typically taxed at regular income tax rates which are usually lower unlike when calculated with long-term capital gains rates.
Owotorose defined annuity as a contract between “you and an insurance
company in which you make a lump-sum payment or series of payments
and, in return, receive regular disbursements, beginning either
immediately or at some point in the future. The goal of an annuity is to provide a steady stream of income, typically during retirement.
“Many aspects of an annuity can be tailored to the specific needs of
the buyer. In addition to choosing between a lump-sum payment or a
series of payments to the insurer, you can choose when you want to
annuitize your contributions—that is, start receiving payments. An
annuity that begins paying out immediately is referred to as an
immediate annuity, while one that starts at a predetermined date in
the future is called a deferred annuity.”
“The duration of the disbursements can also vary. You can choose to
receive payments for a specific period of time, such as 25 years, or
for the rest of your life. Of course, securing a lifetime of payments
can lower the amount of each check, but it helps ensure that you don’t
outlive your assets, which is one of the main selling points of
“Annuities come in three main varieties: Fixed, variable, and indexed. Each type has its own level of risk and payout potential. For any of these, it is often structured as a deferred annuity,” he
Emir Charges Insurers To Meet Obligations Adequately
The Emir of Kano, Alhaji Aminu Ado Bayero has urged the National Insurance Commission (NAICOM) to ensure insurance obligations are adequately met by the insurers, especially when the need to pay claims arises.
The Emir, who gave this charge when the Management of NAICOM led by the Commissioner for Insurance, Olorundare Sunday Thomas paid a courtesy visit to the Emir’s Palace in Kano on Tuesday, also urged Nigerians to embrace insurance as a way of relieving loss, especially in businesses and property loss.
He reiterated that insurance is an important aspect of human life as extensive research has shown that insurance is not conflicting with religious belief, especially with the coming of Takaful insurance.
The Emir equally commended the leadership of the Commission for the giant strides and efforts in developing the Nigerian insurance market.
He further thanked the Commission for the visit and promised to support insurance deepening in the country, even as he assured that he would consider the invitation to the National Insurance Conference and will personally attend the conference.
The Commissioner thanked the royal father for the warm reception and his acceptance to personally attend the National Insurance Conference scheduled for October 22 – 24, 2023, in Abuja.
The Commission thereafter named the Emir Aminu Ado Bayero as Royal Ambassador for Insurance in the country and commended his style of leadership since his takeover of the throne.
Experts Canvass For Laws To Ensure Survival Of Insurance, Pension Sectors
The Managing Director of APT Securities and Funds Limited, Kasim Garba Kurfi, has charged the government to put in place enabling policies and laws that support the survival of the sectors for them to continue contributing to the nation’s growth.
He described the insurance and pension sectors as the engine of growth of Nigerian economy considering the roles played by the two sectors in sustaining economic growth.
Kurfi, who stated this while delivering the theme paper at the 8th Annual Conference of the Nigerian Association of Insurance and Pension Editors (NAIPE) in Lagos recently, said insurance and pension sectors today stand as engines for sustainable economic growth and forces to reckon with in every economy. The conference’s theme was “Role of Insurance and Pension Sectors In Building Sustainable Economic Growth Under The New Government”.
He highlighted the contributions of the two sectors to the national economy saying, “There is over N2.5 trillion assets managed by the insurance institution in Nigeria as of 31st December 2022.
“While there is over N16.6 trillion assets managed by the Pension Fund Administration as at 31st December 2022, the combination of the two institutions has a total asset of over N19 trillion. The role played by the two institutions in sustaining our economic growth left no one in doubt that they are instruments for most of the economic development
“Over N726 billion in premiums paid in the year 2022 according to the National Insurance Commission, while the industry also paid over N318.1 billion in claims to its customers within the same period. This is a remarkable achievement in comparison with 3.5% growth of Gross Domestic Product (GDP).”
He said insurance institutions give security to the future of the common people and aid economic growth upon happenings or allowance of specific event or disaster.
“Insurance represent promise of the future compensation in case of specific losses or in exchange for periodic payment called premium.
“Managing risk is very important for companies dealing with money or equivalent. The insurance industry promotes National development through wealth creation or protection. It primarily hedges against risk or contingent or uncertain loss.”
On pension, he said, “The contribution of pension funds that run over N16 trillion is pronounced in all phases of life. Many sectors of the economy benefit from excess funds that look for alternative ways to invest such as FGN SUKUK, GREEN BOND, and Infrastructures Bond, among many others.”
Kurfi said Pension ensures that every worker receives his/her retirement benefit as at when due. Ensure workers save in order to cater for future liability and old age. Provide long-term finance for the real sector. Stimulate the development of the capital market.
While condemning those agencies and institutions clamouring to exit Contributory Pension Scheme (CPS), Kurfi enjoined the government at all levels to discourage such moves for the interest of the Pensioners and the nation’s economy.
He said the contribution of insurance and pension sectors towards economic development is imminent and can be seen especially in driving the nation’s financial inclusion project.
NAICOM Encourages Nasarawa Residents To Embrace Insurance
By Sola Alabadan
In line with National Insurance Commission (NAICOM) determination to ensure that Nigerians enjoy the benefits of insurance, the commission took its insurance sensitisation campaign to Nasarawa State recently.
The Commissioner for insurance, Sunday Thomas and a delegation from NAICOM paid a courtesy visit on the Executive Governor of Nasarawa State, Engr. Abdullahi Sule to intimate him and members of his executive council about the benefits of insurance.
NAICOM has been striving to sensitise stakeholders on the benefits of compulsory insurances such as Insurance of Public Buildings, Insurance of Buildings Under Construction, Third Party Motor Insurance, amongst others,
The Commissioner for Insurance also used the opportunity to formally invite the Governor to the National Insurance Conference scheduled to hold from 22-24 October, 2023.
Responding, the Governor gave a personal testimony while he was still in the private sector of how the sugar refinery where he worked as the Managing Director was razed by fire but thanks to insurance, a newer and better one was built from the claims paid by the insurance company concerned.