The National Insurance Commission (NAICOM) has extended the insurance sector recapitalisation deadline to December 31, 2020, from the June 2020 deadline it had stipulated previously.
The commission disclosed this yesterday in a circular signed by its Director, Policy and Regulation Directorate, Mr. Pius Agboola.
Agboola, in the circular entitled: “Minimum Paid Up share Capital Policy for Insurance and Reinsurance Companies in Nigeria,” dated December 30, 2019, and sent to all insurance and reinsurance companies, noted that the commission had reviewed the recapitalisation plans submitted by operators and various levels of compliance observed.
He said the commission had noted the inputs from the various engagements with relevant stakeholders and, “therefore, extends the recapitalisation deadline to December 31, 2020.”
Agboola disclosed that the Central Bank of Nigeria (CBN) has obliged the commission with the recapitalisation escrow accounts (T24) for the deposit of fresh funds raised for the exercise, with details: T24 Account Name: Recapitalisation Escrow – NAICOM and T24 Account No. 0230164061014.
Agboola, maintained that as parts of the measures to ease the recapitalisation burden, some of the relevant agencies have set up help desk to fast-track processing of applications for, ‘No Objection’ and for approvals, stressing that engagements with these agencies on other palliatives were ongoing.
NAICOM, had in May, 2019, announced an over 300 per cent increase in the paid-up share capital of insurance companies and had given June 30, 2020, as deadline for compliance.
Going by the new capital regime, life insurance firms were asked to upgrade their capital from present level of N2 billion to N8 billion; those into general business will raise theirs from the current N3 billion to N10 billion while composite firms were required to raise theirs from N10 billion to N18 billion.
Reinsurers were asked to provide N25 billion.
However, since then, insurance operators have been striving to beef up their capital.