Insurance Companies are running a race to meet the recapitalisation requirements as directed by National Insurance Commission (NAICOM).
May 2019, National Insurance Commission (NAICOM) released new capital requirements for insurance businesses with a 13-month compliance period for operators to shore up their minimum capital base to the required level.
The minimum paid-up share capital of a Life insurance company was increased from N2 billion to N8 billion, Non-Life insurance from N3 billion to N10 billion, and Composite insurance from N5 billion to N18 billion while Re-insurance companies were directed to raise their capital base from N10 billion to N20 billion.
AFRICAN Alliance Insurance Plc is strategizing on how to raise more capital to help its recapitalisation plan. This strategy will not left out the Shareholders in the company because of their continuous faith in the business over the years, said the Chairman.
Chairman of the company, Dr Anthony Okocha, also said the company’s recapitalisation plan involves a combination of strategies including new equity injection by existing and new investors, assets conversion as well as possible merger.
“There is no doubt we are on the rise again, considering where we were before now. In the period under review, our profit after tax decreased from a loss of N6.72b in 2017 to a loss of N2.4bn in 2018. It is important to note that the bulk of these year-on-year losses were technical arising from the drop in interest rates which significantly affected the returns on annuity assets that accounted for 96% of the company’s business portfolio. By the time the 2019 results are released, you would see how your company has turned the bend,” said Dr Anthony Okocha.
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