NAICOM to Probe Capital Base of Insurance Companies

• Moves to limit bogus mgt expenses

James Emejo in Abuja

The National Insurance Commission (NAICOM) said it would verify the capital resources of all insurance companies operating in the country during the first quarter of the year.

It stated that the probe had become necessary in view of the fact that the business environment and risk profile of the companies had changed since 2007 when the last recapitalisation exercise was conducted.
The apex industry regulator also said the move would further ensure protection of policyholders and beneficiaries of Insurance contact against unexpected losses.

The commission further stated in its circular on Statement of Regulatory Prioties for 2017, which was released yesterday that the cost of the verification exercise will be borne by the companies.

The commission further said it would pay attention to management expenses which has become a cause for concern in the industry.
It said it would henceforth move to ensure that companies” level of expense is appropriate for its business model and does not adversely affect profitability, liquidity and capital adequacy.
According to the commission, other area of supervisory priority include increased risk based supervision, compliance with statutory returns, leveraging on information technology as well as the competence of directors, senior management and persons in control functions and emphasis on service delivery.