The Good Governance Assembly (GGA) has urged President Bola Ahmed Tinubu to remove the Commissioner for Insurance and Chief Executive Officer of the National Insurance Commission (NAICOM), Mr. Olusegun Ayo Omosehin, pending an independent investigation into allegations surrounding the recently concluded insurance industry recapitalisation exercise. The group cited concerns over regulatory accountability, financial transparency, and administration of shareholders' funds.
According to the GGA, petitions submitted by NICON Insurance Limited and Nigeria Reinsurance Corporation to the Economic and Financial Crimes Commission (EFCC), the Federal Ministry of Finance, and the Presidency, raised serious questions about NAICOM's actions. The complaints centred on the alleged imposition of a one per cent capital injection fee on shareholders' funds and a directive requiring companies to transfer recapitalisation funds into Central Bank of Nigeria (CBN) escrow accounts.
The GGA also expressed concern over an alleged collection of about N180 million for verification consultants, whose engagement has been questioned. The companies have challenged the legal basis of some of the disputed requirements. In response, the Federal Ministry of Finance directed NAICOM to suspend enforcement of the disputed one per cent capital injection fee, other processing and verification charges, and the full-capital escrow requirement against NICON and Nigeria Re.
The GGA's Executive Director, Peter Bawa, stated that the continued presence of the NAICOM boss at the centre of the controversy could create a perception of conflict while the relevant institutions examine the allegations. The group also noted that reports of the disputed charges could amount to billions of naira across the industry, which could undermine the recapitalisation exercise designed to strengthen the insurance sector and restore investor confidence.
The insurance sector recently concluded the recapitalisation exercise, with NAICOM reporting that the industry attracted approximately N1.079 trillion in fresh capital. The regulator said 48 insurance companies and two reinsurance companies met the new capital requirements and were relicensed. The GGA expressed concern that the achievement should not be overshadowed by unresolved questions surrounding the implementation of the exercise.
Bawa emphasised that the insurance industry's major financial exercise must be accompanied by the highest standards of transparency and accountability. He urged President Tinubu to consider the removal of Mr. Omosehin from office to allow a credible, independent, and transparent investigation to take place without any perceived conflict of interest.
The GGA's call for the NAICOM chief's removal highlights the need for regulatory accountability and transparency in the insurance industry. The group's concerns and demands for an independent investigation underscore the importance of ensuring that regulatory actions do not compromise the integrity of the financial system or undermine investor confidence in the sector.
Key points
- GGA demands removal of NAICOM chief over alleged regulatory breaches
- Disputed charges could amount to billions of naira across the industry
- Insurance sector attracted N1.079 trillion in fresh capital during recapitalisation exercise
