The National Insurance Commission has adopted a doctrine that no Director of challenged insurance company will go Scot free and, under the current procedure Directors will be held responsible as not done in the past.
Pushing out the doctrine of no escape route that makes compulsory for Directors to work the weak companies back to financial stability, the Commissioner for Insurance, Olusegun Ayo Omosehin at a recent media interaction in Lagos, admitted that there are a few challenged companies which are being managed so that they are not allowed to go under. Letting that happen Omosehin said, would have negative impact on the sector. And the action of the Commission so far made that unlikely.
Admitting that the overall effect of not closing in on all fronts would be massive, the CFI said it was the Directors of the ailing companies that would made to return the companies back to profitability. The Commission he explained, hold them liable because they created the holes. “These holes they created they have to cover them.” As a matter of urgency he said the Directors have to bring the money to put the companies back on track.
Omosehin said for avoidance of doubt, the companies are not heading to the exit door to serve as a clearance for the Directors to experience a sigh of relief and melt away from with the loot. Instead he said, “The Directors are going nowhere. Some of them want us to shut the companies and they go with their loot; they are going nowhere. The reality of the situation is that we don’t want anybody to go Scot free.
“If you contributed to the fall of a company we will go after you. Not only that you can no longer run a company, you can no longer be a director in a company, we will blacklist you. We will go after your reputation and if possible hand you over to the relevant agencies. We need to discourage people from doing this,” he stated.
NAICOM Boss said the number involved are few though but the negative effect of not being involved as the Regulator could be significant and should be avoided. Burrowing further, he said regulatory intervention was heightened by the prevailing negative image of the sector when it comes to claims settlement.
“The impact is what we are trying to manage, we don’t want it to rub off on companies that are doing so much. We have entities in this market that are doing a whole lot to change the face of insurance but their efforts are not coming through because of a few we are talking about.”
Adding to this discourse is the Deputy Commissioner for Insurance Technical, Dr. Usman Jankara, who gave a distinction between the companies in this space to include two companies that their licences were repossessed by the Commission. They challenged the liquidation process in court one had its licence reinstated and the other lost and the licence remained cancelled and the liquidation process is on going.
On the reinstated company, he said the Commission has not gone to sleep ‘to the effect that you have your licence licence back, just keep it and tell us when you are going to use it.’ On the contrary, he said the Commission is already engaging. “We summoned the board to discuss with a view to actively enforce some kind of turnaround plan or deadline that we had agreed with them.’ Demonstrating that the Commission surround policy on company involved have no broken hedges, he cleared, “further necessary actions will be taken when these deadlines are breached.”
