The National Insurance Commission (NAICOM) has written an administrative letter to insurance companies that are presently undergoing financial challenges.
It was gathered that the letter detailed how the firms could manage their funds to enable them navigate their financial problems. The firms written, joined other insurance companies that are under the management of the commission, which activities are keenly monitored by NAICOM.
Sources at the commission, said that the steps were taken to save the firms from collapse. One of them, said after the commission published the accounts of insurance companies, those with problems were identified and confronted with issues observed in their reports and mandated on things to do to improve their performance.
Late last year, it was reported that 12 insurance companies urgently need to shore up their shareholders’ funds in 2018 to enable them play comfortably well in the highly competitive underwriting business.
According to 2016 Insurance industry financial reports published by NAICOM, these firms are operating below or slightly above the industry’s statutory shareholders’ funds.
In the last insurance industry recapitalization, Non-Life insurance firms were mandated to raised their shareholders’ fund to N3 billion; Life Insurance operators, N2 billion, Composite N5 billion and Reinsurance N10 billion.