NIA expels Standard Alliance, IGI, Niger Insurance
For failing in their obligations to their policyholders, the Nigerian Insurers Association (NIA) has finally wielded the big stick, expelling Standard Alliance Insurance and two others from its membership.
The other two are Industrial and General Insurance Company limited (IGI) and Niger Insurance Plc.
The leadership of the market association for underwriters also ordered the trio to remove its logo from their letterheads and official documents forthwith.
The NIA may have been forced to take the decision following several complaints from policyholders against the trio that were lodged with the association and the insurance regulator, the National Insurance Commission (NAICOM).
The situation which is a flat fall from grace for the trio that were hitherto frontline firms, took centre stage at the workshop by NAICOM for the media where participants labelled the regulator as toothless dog for its inability to wield the stick to beat failing underwriters to order.
In a public notice signed by its Director General, Yetunde Ilori the NIA stated that the “The Governing Council has approved the expulsion of the three companies from its membership for failing to meet their obligations to Policy holders, thus negating the principles of insurance.”
Ilori went further to say that the affected companies should cease forthwith from using the association’s logo on their letterheads and their official documents.
Although the association was silent on specifics but had two years ago reported the refusal of Standard Alliance to honour a discharge voucher issued on 5th April 2019 to one of its policyholders, Mack Ogbamosa.
Ogbamosa had Income Protection Policy (IPP) with policy number IPP/10/0007796/IKJ with Standard Alliance Insurance on which the company had agreed to pay him N1, 436,790.54 as benefits on its discharge.
Despite repeated calls and letters to both the company and the insurance regulator, NAICOM, Ogbamosa has yet to be paid by the company, two years after the Discharge Voucher was issued.
In practice, however, an insurance company has 90 days to pay up after the issuance of discharge voucher.
“I signed my discharged voucher from Standard Alliance Insurance Co since April 5, 2019 for the sum of N1.44m and has written two reminders to both the company and NAICOM but up to this moment, nothing has been done by both parties,” stated Ogbamosa in a statement.
Claim payment has always put the insurance industry on the spot and it got worse when the sub-sector battled liquidity problems occasioned by the tottering Nigerian economy which started on a decline after 5 May, 2008 when the Margin loan crisis began.
Many businesses including the Underwriting firms’ financial positions were worsened by the collapse of the capital market in 2008 after foreign investors recalled their investments from the Nigerian capital market.
Nigerian banks which granted huge margin loans also began a recall of their credits, thus hastening up the crash of the capital market from which many investors could not recover.
