The House of Representatives has directed the National Insurance Commission (NIACOM) to suspend the planned Dec 31, 2020 mandatory deadline for the first phase of 50 per cent of the minimum paid up share capital for insurance and reinsurance companies.
The House said the suspension should be for at least a minimum of six months from January 2021 so as to cushion the efforts of COVID-19 and other unforeseen circumstances on the insurance industry. The resolution was consequent upon the approval of a motion sponsored by Hon. Benjamin Okezie Kalu (APC, Abia) and fifteen other lawmakers. Presenting the motion, Kalu informed that NAICOM had issued a circular No.
NAICOM /DPR/CIR/25/2019 dated May 20, 2019 on the minimum paid-up share capital requirement for insurance and reinsurance companies. He said the circular effectively increased the minimum paid up share capital for insurance and reinsurance companies.
“The original deadlines were May 29, 2019 for new companies, while, 30 June 2020 was to apply to existing companies. “The changes to the minimum paid up share capital were as follows Life Insurance N2 billion to N8 billion, General N3 billion to N10 billion, Composite N5 billion to N18 billion and Reinsurance N10 billion to N20 billion. This was later moved to 31 December 2020”, he stated. Kalu noted that as a result of COVID 19, the deadline was moved by NAICOM, vide circular NAICOM/DPR/CIR/25-04/2020 and dated June 3, 2020.