Shareholders on Monday commended the National Insurance Commission (NAICOM) over the cancellation of the Tier Based Solvency Capital recapitalisation.
The shareholders under the aegis of the Independent Shareholders Association of Nigeria (ISAN) said the cancellation of the recapitalisation bid by NAICOM was a welcome development and a sign of respect for the rule of law.
Mr Moses Igbrude, ISAN Publicity Secretary, told journalists in Lagos that it was a welcome development that the regulator toed the path of law.
Recall that NAICOM on Nov. 23 announced the cancellation of the Tier Based Solvency Capital policy for the underwriting sector with immediate effect.
The commission gave this notice in a circular to all insurance companies on ‘Withdrawal of circular on Tier Based Solvency Capital policy for insurance companies in Nigeria,’ signed by the Director, NAICOM, Mr Agboola Pius, on Friday.
It will be recalled that recently, NAICOM announced a raise in the minimum capital base for life, non-life and composite insurance companies seeking licences to underwrite all risks in Nigeria.
The companies required from N2 billion, N3 billion and N5 billion to N6 billion, N9 billion and N15 billon, respectively under the tier-based minimum solvency capital structure.
It later announced an Oct. 1, 2018 deadline, which was not accepted by stakeholders, pushing them to take a legal action against the commission.
Igbrude said the shareholders were not against insurance recapitalisation but rather not comfortable with the short period of time NAICOM gave them for the exercise.
He said the shareholders were worried by the way and manner NAICOM changed the recapitalisation deadline from January 2019 to October 2018.
“The way they suddenly brought the day backward from January 2019 to October 2018 raised our suspicious to whether some cabal in the sector wants to corner insurance business through such a sudden and drastic action,” Igbrude said.
