The Federal Government has insured its workers to the tune of N17.7bn since the introduction of the group life assurance scheme in December 2008.The first premium of N4bn was paid in December 2008; it also made a total payment of N7bn in 2010; and another N6.7bn was paid to the insurance companies underwriting the scheme.The lead underwriter of the scheme in 2008, Managing Director, Capital Express Assurance, Mr. Tony Aletor, confirmed the N4bn premium.The Commissioner for Insurance, Mr. Fola Daniel, said the Federal Government had paid about 60 per cent of N9bn approved for its workers under the scheme in 2011.The group life assurance derives its existence from the 2004 Pension Reform Act Section 9(3) of the Act states, Employers shall maintain life insurance policy in favour of the employee for a minimum of three times the annual total emolument of the employee.The scheme is to provide compensation for all federal civil servants who died in service. Under the guideline, the office of the Head of the Civil service of the Federation is responsible for the implementation of the guidelines in respect of the employees.After the first premium, the scheme has been marred by poor rating while the underwriters are also complaining that the business is becoming more unprofitable.For instance, last year, the sector lost N15bn due to inappropriate pricing of the policy. While N22bn was proposed to do the business, to be the lead in the consortium, the companies tendered their rates at ridiculously low rates, which eventually collapsed the premium from the initial amount of N22bn to N7bn.The Chairman, Nigerian Council of Registered Insurance Brokers, Port Harcourt Area Committee, Mr. Dele Kareem, commended the efforts of the National Insurance Commission in ensuring that the premium was paid to the industry.He, however, regretted that the N7bn, which the sector eventually got was inadequate.He said,When you look at the armed forces, we have so many peace keeping missions outside Nigeria; they die everyday, if you also look at our police, they are killed everyday by armed robbers, accidents and the rest. And this increases the claims paid.Daniel, reacting to the complaint by the underwriters that the business was no longer profitable, explained that the insurance industry quoted premium rate voluntarily, which the government had been paying.He said, If you write a portfolio that is not profitable, there are underwriting measures you can adopt, one of such is review of rate, as regulator, it will not be our business to go to the government to ask for a review of the rate. The underwriters have the statistics to push for enhanced rate it necessary, they know exactly how to access more money.According to him, the insurance industry has been meeting their obligations, under that scheme.We have not received one complaint against any insurance company for failing to meet the obligations under the group life scheme as arranged by the Office of the Head of Service, Daniel said.
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