Review of Regulation on Retiree Life Annuity Due
Commissioner for Insurance, Mr. Sunday Thomas has disclosed that the National Insurance Commission (NAICOM) and the National Pension Commission (PenCom) has reached an agreement to review the guidelines on Annuity under Contributory Pension Scheme.
There have been issues between operators on programmed withdrawals and annuity for retirees but the two agencies, under the leadership of Mr Sunday Thomas of NAICOM and Mrs Aisha Dahir-Umar of PenCom seem to have reached an agreement and we expect that the proposed guidelines will in the best interest of retirees allow for meaningful competitions between operators.
The issues heightened in 2017, when both government agencies headed by the former Commissioner for Insurance, Mohammed Kari and Director-General of PenCom, Mrs. Chinelo Anohu-Amazu bickered, leading to the intervention of the former Minister of Finance, Mrs. Kemi Adeosun, who called a truce between them, although there was no headway but it at least led the two regulators to issue a Joint Circular on Strengthening Life Annuity administration for pensioners in March 2017. The operators noted in the Joint Circular that the “Regulation on Retiree Life Annuity” will be released within 3 month but its now over 3 years after.
As provided for by the Pension Reform Act 2014, the modalities for payment of retirement benefits are through life annuity, which is obtainable from life insurance companies or through programme withdrawal, which is obtainable from Pension Fund Administrators (PFAs).
The Commissioner for Insurance, Mr. Sunday Thomas who confirmed to The Nation that the two agencies had reached an agreement and would soon sign the guidelines for the two industries said, “On our part, we have been able to identify all the areas where the industry has been de-marketed and we are working on them. we will sign the annuity guideline with PenCom very soon. It has been pending since 2017 but we are happy that everything will go well going forward. I have been very concerned as to why insurance companies are limited in annuity business. The annuity business looks like it is slowing down but it will soon be one of profit driving business for the insurance industry.”