Heirs Holdings, owned by Tony Elumelu, a banker and an entrepreneur may have secured a composite insurance license that would enable the conglomerate operate a life and non-life insurance business in Nigeria, BusinessDay investigations show.
The Insurance company which has Tony Elumelu, the chairman of Heirs Holdings as member of the proposed board, alongside five other people and Tony Aniemeke as proposed CEO, will be called Heirs Insurance Limited.
The development confirms BusinessDay’s exclusive story last week about the plan by the National Insurance Commission, (NAICOM), the industry regulator, to issue fresh licence, in a renewed effort at deepening insurance penetration and also enhance the sector’s capacity for big ticket transactions.
Heirs Holdings is an African investment company focusing on principal investments in a variety of sectors across Africa, with specialisation in financial services, power, oil and gas, real estate and hospitality, agri-business and healthcare
This is the second license to be issued by the Commission since the insurance industry recapitalisation exercise in 2007 after FBN Life Insurance was awarded in 2011. This also brings the total number of composite insurance companies to 13, out of 60 underwriting firms operating in Africa’s largest economy.
The issuance of the maiden license to FBN Life Insurance about four years ago, according to the Commission, was based on the expectation that the Company would ride on the back of First Bank Holdings, it’s parent company to deepen insurance penetration using their numerous branch network of over 700 across the country.
FBN Life, recently concluded acquisition of Oasis Insurance, a non-life company.
Tope Smart, group managing director, NEM Insurance plc, said it’s a welcome development, and signifies two things. One being that the National Insurance Commission can still issue fresh license if need be, and that people both within and outside Nigeria are showing interest in the country’s insurance industry.
Smart said the coming of Heirs Insurance Limited is an additional capacity for the industry and set’s room for increased competition.
On whether the coming of Heirs Holdings as a conglomerate would have any significant impact on the operations of the industry, particularly in deepening penetration, Smart said “There is not going to be any significant thing to expect, they will play like any other company in the market, and with everybody’s efforts put together, the industry will be better.”
Fola Daniel, commissioner for Insurance said at a recent interview, that NAICOM stopped issuance of fresh license for a long time because it needed some level of consolidation in the industry.
“There is no law that says we cannot issue fresh license, but we felt we should hold on for a while to enable some consolidation, including mergers, injection of fresh funds and investment from within and outside Nigeria into existing companies”
He said: “In a democracy, no government official or commissioner can say there would not be issuance of license, you cannot do that. If a company meets all the requirements, we cannot but issue license, we also look at the moral factor, such as, would the company create additional value and improve the industry?
“We also have the responsibility to help the government in job creation and reducing unemployment. So, if a new company is coming on board and it would generate employment for Nigerians, add value to insurance, why would we not give it a licence.”