Underwriting firms file financial returns to meet deadline

TOUGH regulatory measures taken by the National Insurance Commission (NAICOM), including heavy fines to restore transparency and accountability in the conduct of insurance business in Nigeria, may have forced operators to rush to Abuja and file financial returns for last year to meet 30th June deadline.The Guardian gathered that the directors of some insurance companies had to change auditors in line with the new rules to facilitate quick submission of audited reports, to avoid N5,000 fine each day of default in submitting returns.The commission however, still realised over N2.17 billion from fine, levies and penalties on late financial returns and inaccurate reports.The Commissioner for Insurance, Fola Daniel, said that the response of operators this year has been encouraging. 'We have to be firm on the issue of code of ethics to strengthen public confidence in the insurance market.'For instance, the prudential guideline issued by the commission states that any insurer which failed to file the financial returns and accounts not later than June 30 of each year was liable to pay N5,000 per day of default.'He explained that the bulk of the commission's internally generated revenue came from the statutory one per cent levy on gross premium income of underwriting companies and intermediaries, fines for breach of laid down rules and regulations, which the commission earned N2.17 billion, while receipt from government's subvention amounted to N582.7 million last year.'You are aware that if the insurance industry is doing well, then the economy will move faster because it will allow innovation to take place and for entrepreneurs to take risk,' Daniel said.According to him, 'we have strengthened our regulatory capacity and was closely monitoring activities of operators in the industry,' adding that 'practitioners have no choice but to practise the business of insurance according to the rules and regulations to provide quality services to consumers particularly in payment of claims.'An industry chieftain who spoke to The Guardian on condition of anonymity said: 'The commission has been firm on the issue of code of ethics and corporate governance in the industry when it began the reforms in the industry two years ago.
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