Story by Kayode Tokede
The National Insurance Commission (NAICOM) has disclosed that the insurance industry life annuity fund portfolio in Nigeria grew by 17.46 per cent to stand at N322.91 billion at the end of the second quarter (Q2) of 2019, against N274.918 billion stood at the end of the fourth quarter of (Q4) of 2018.
Within the same interval, the cumulative total retiree life annuity (RLA) added up to N122, 094,395,111.31 at end of Q2, 2019.
The Head, Commissioner for Insurance’ Directorate, NAICOM, ‘Rasaaq ‘Salami, in a statement explained that the RLA market has been in existence since the advent of the Contributory Pension Scheme (CPS).
The RLA portfolio so far, the statement added, recorded 73,554 contracts purchased for a total premium of N341, 61 billion as at end of Q2, 2019. This depicts 13.02 per cent and 6.21 per cent growth in count and volume, respectively in 2019 from the end of Q4, 2018.
Further checks show that the growth (YoY) during the last three years for RLA business has averaged 34.28 per cent and 35.12 per cent in count and volume respectively, while RLA fund portfolio growth has averaged 27.46 per cent, notwithstanding the RLA cumulative total payouts of N122. 09 billion as at the end of Q2, 2019.
The annuity payouts, premium receipts and portfolio fund balance depict a clear representation as to the difference between the cumulative premium amounts received and fund balance is small (i.e. N18,696,679,160.42) compared to the cumulative annuity payouts earlier stated.
Retiree Life Annuity is an insurance product and one of the available retirement benefit options for retirees, which can be purchased from a Life Insurance Company, licensed by the NAICOM and authorized to sell RLA under the regulation on the retiree.