The National Insurance Commission (NAICOM) has clamped down on Industrial and General Insurance (IGI) Plc and UnityKapital Assurance Plc in exercise of the powers conferred on it by enabling laws.
The commission, in line with the regulatory orders conveyed on it, had ordered the IGI, in separate letters dated July 30 and 31, 2015, to appoint an auditing firm from amongst KPMG, PWC and Delloitte to conduct a comprehensive financial review of the company and submit the report to the it within two weeks of the date of the regulatory order.
In a statement signed by the NAICOM’s head, Corporate Affairs, Mr ‘Rasaaq ‘Salami, the orders which were signed by the then deputy commissioner (Technical), Mohammed Kari, also restricted the board of UnityKapital from holding any meeting or taking any further decisions in respect of the affairs of the company during the subsistence of the regulatory order.
According to the order, the auditing firm will undertake a comprehensive review of IGI’s accounting system; conduct capital verification and validate the financial position of the company as at July 31, 2015.
“The management is ordered not to incur any expenditure in excess of N250,000 and not carry out new investments or dispose of any of its assets without the prior approval of the NAICOM. The IGI will submit monthly report on its activities to the NAICOM effective August, 2015.
“The board of UnityKapital is restricted from holding any meeting or taking any further decisions in respect of the affairs of the company during the subsistence of the regulatory order,” the statement reads in part.
While the executive management is directed to run the affairs of the company, all issues which may require the approval of the board shall be referred to the commission for consideration for approval.
“The management is restricted from incurring any expenditure on a single transaction in excess of N250,000 without prior approval of the commission. It shall also not incur any capital expenditure within the subsistence of this regulatory order without the approval of the commission.
“The order forbids UnityKapital divesting any of its existing investment without a written approval from the commission. All proceeds of divestment that have commenced prior to the order shall be paid into a dedicated account as approved by the commission,” the statement further reads.
According to the NAICOM, both orders are with effect from August 3, 2015, and for initial periods of six months in the case of the IGI and (90 days) for UnityKapital. It added that the orders may be extended to such a period when the commission is satisfied that there is no potential risk to policyholders of each of the companies.