Stakeholders Worry Over NAICOM’s 50% IGR Remittance

By Clement Alphonsus

Stakeholders in the insurance industry have urged the federal government to reconsider its directive to the National Insurance Commission (NAICOM) to remit 50 per cent of its internally generated revenue (IGR) to the federation account.

It should be recalled that a policy of compulsory 50 per cent deduction from the IGR of all government enterprises was introduced by the government as part of efforts to increase revenue and plug leakages in revenue collection.

While speaking on the development, the President of the Council, of the Nigerian Council of Registered Insurance Brokers (NCRIB), Babatunde Oguntade, noted that the insurance supervisory fund levy being paid by insurance institutions is meant for the regulatory supervision and market development drive.

According to Oguntade, “Placing the insurance supervisory fund levy within the single treasury account system would hold back the financial solvency position of the commission and ostensibly hinder the market’s much-desired insurance growth in the country.”

The NCRIB President further explained that the insurance industry, which should be the linchpin of the economic revival efforts of the government in Nigeria, was currently fragile.

While speaking, an insurance practitioner and Lead Director of Transparency Protection Limited. Dr. Sam Chukwuka Onyeka, further warned that the insurance sector growth will be highly affected if the government fails to reconsider the commission as a revenue-generating entity.

Onyeka noted that the government should consider exempting NAICOM from the list, warning that it could seriously weaken the Commission’s financial capacity, making regulation and supervision of the insurance industry an uphill task.

According to him, “The only way to avoid this might be to increase the amount of the statutory supervisory levy. Yet, this will surely be counter-productive, as the insurers will naturally push the difference into the premiums which they charge for insurance products, thus driving insurance products beyond the reach of Nigerians."