Orosanye In N8B Premium Mix-Up As Senate Probes Petition

Source: EMMA UCHE - thewillnigeria.com
Listen to article

ABUJA, July 07, (THEWILL) -The Head of Service of the federation, Mr. Steve Orosanye is enmeshed in over N8 billion insurance premium mix-up, a senate panel heard today.

A consortium of insurance firms in the country petitioned the Senate Committee on Banking and Insurance over non-remittance of about N8 billion premium for the management of civil servants Group Life insurance scheme.

Consequently, the Senate panel flagged off public investigation into the matter, with Orosanye and the petitioners present.

The petitioners alleged the office of the HOS failed to remit N2 billion naira even as it was provided for in the 2009 budget adding that instead Mr. Oronsaye used the money as down payment for the current year.

As part of the anomalies in the management of the scheme, the consortium said, "N5 billion was the approved premium in 2008 for Group Life. N1 billion was set aside to settle deaths during the transition period of the group life. Till date no account was rendered to the consortium by the Lead Underwriters."

When they appeared before the committee, the petitioners alleged that the office of the HOS chose five consultants to manage 85 percent of premium for the group life insurance for civil servants with the firms also serving as brokers.

Speaking on behalf of the petitioners, Mr. Fidelis Ajufo said, "We also wish to state that the appointment of insurance brokers and underwriters for 2010 have not followed due process, as some of the insurance brokers were made to undertake oath of secrecy some appointed insurance brokers do not have NAICOM license and they do not belong to the Nigerian Council of Registered Brokers as required by the insurance Act 2003."

The petitioners alleged favouritism in selection of managers for the group life insurance scheme by the HOS saying, "The allotment is lopsided, whilst some brokers and underwriters are collecting commissions and premiums of N250 million and N2.4 billion respectively, others are allotted less than N30, 000 and N300, 000 respectively."

In his explanation to members of the Senate committee, Mr. Oronsaye said he did not pay the N2 billion premiums for last year because there was no insurance cover for the civil servant at the time.

He said his office paid a total of N500 million as death benefits to families of civil servants that died within the year.

It could be recalled that the petitioners representing over 50 petitioners under the aegis of 2008/2009 Insurance Brokers Underwriters had also in a petition sent to then Acting President Goodluck Jonathan, expressed concern over the deduction of N1 billion from source for payment of anticipatory claims; additional N100 million deducted from source for capacity building and N4 billion made available for lead underwriter in 2008.

However, Senator Nkechi Nwogu (PDP, Abia), chairman Senate Committee on Banks, Insurance and other financial institutions who spoke at the investigative hearing titled "Misappropriation of 2008/2009 premium by Head of Service" and "Anomalies in the 2010 Head of Service Group Life Assurance Consortium of Underwriters and Insurance Brokers Appointment" asked Orosanye to furnish the committee with documents covering all the money spent so far on insurance for civil servants.

Other lawmakers who expressed concern over the crisis between the parties, included Senators Patricia Akwasiki; Felix Bajomo; James Manager; Patrick Osakwe and Ibrahim Maciddo. They all demanded for detailed information on the N4 billion appropriated for insurance benefit and amount paid as insurance claims in the year 2008.