BusinessDay 24 May 2017

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Wednesday 24 May 2017 22 BUSINESS DAY C002D5556 InsuranceToday E-mail: insurancetoday@businessdayonline.com Wapic Smart Wealth Plan targets to raise financially smart citizens L-R: Segun Balogun, managing director/CEO, LASACO Assurance Plc; Babatunde Rotinwa, chairman, Local Government Service Commission and Musliu Folami, commissioner, Ministry of Local Government & Community Affairs at the presentation of death benefit cheques from LASACO Assurance Plc to beneficiaries of deceased employees of Lagos State. As part of its vision to ensure that financially smart citizens are raised in the society, Wapic Insurance has introduced yet another ground breaking insurance product under the umbrella of SMART Plan known as the Wapic Smart Wealth Plan. Speaking at the launch of the product, Oroma Ovunda-Nsirim of the corporate communications unit, Wapic Insurance noted that this is an insurance solution that provides one, the opportunity of investment and embedded insurance protection against the risks of demise. The insurance premium is deducted within the period of investment but insurance cover is for life even when you have taken the maturity proceeds. Wapic Smart Wealth Plan provides you, in addition, the benefit of an insurance cover for life even when premium is deducted from your contribution only within the investment period. She further noted that more benefits of the products as: Enjoy life cover beyond duration of the policy, Return on Investment: Flexible but high (linked to FGN Bonds), Critical Illness Benefit: Up to 70 percent of sum assured; balance payable in the event of demise, Life Cover: Payable in the event of demise, Succour in the event of demise, Premiums are tax deductible When asked about the premiums, the company noted that the premium to be deducted depends on the sum assured chosen and the end date of the policy. For a sum assured of N5 million on a policy ending at age 50 years, the premium could be as cheap as N8,000 per month (320/day), for a person aged 35 years. Jocelyn Ogbuokiri, president, Professional Insurance Ladies Association flanked on the left by Tonia Smart; on the right, Femi Ogun with students at the PILA Career Talk for Secondary Schools Student held at the Nigerian Institute of Advanced Legal Studies, University of Lagos. Insurance makes meaning, as LASACO Assurance pays death benefits to Lagos workers Stories Modestus Anaesoronye Insurance does not make much meaning until an incident occurs and people are paid benefits or compensation, which enables the victim or dependants of victims to return to the position they were before the incident or a kind of succour at that critical time when all hope seems to have been lost. This confirmation about the importance and benefits of insurance came to the fore recently, when dependants of bereaved staff of the Ministry of Local Government and Community Affairs and The State Universal Basic Education Board (SUBED) received death benefit cheques from LASACO Assurance Plc, on the life insurance policy undertaken by the Lagos State Government on behalf of its workers. The Pension Reform Act stipulates that every employer, to which the Act applies, must maintain Life Insurance Policy in favour of the employee for a minimum of three times the annual total emolument of the employee. Under the policy, total annual emolument is defined as the basic salary, transport and housing allowances and shall not include bonuses, overtime, directors’ fees or other fluctuating emoluments. Section 8(1) of the Pension Reform Act 2014 stipulates that “Where an employee dies, his entitlement under the insurance policy maintained under subsection (5) of section 4 of this Bill shall be paid by an underwriter to the named beneficiary in line with section57 of the Insurance Act 2003. Segun Balogun, managing director/CEO, LASACO Assurance Plc speaking at the cheque presentation held at Lagos State Secretariat, Alausa commended the State Government for complying with the Pension Reform Act 2004 which mandates employers to provide life insurance for their employees. He said Lagos is among the few State governments that have complied fully with provisions of this law, stating that this shows commitment to welfare the state employees. While thanking Governor Akinwunmi Ambode for regularly paying the insurance premiums despite the economic situation, urged beneficiaries and dependants of the deceased workers to make judicious use of the money so that the dead can be happy wherever they are. Musliu Folami, commissioner, Ministry of Local Government & Community Affairs who represented the governor Ambode reaffirmed the commitment of the state government in ensuring that its employees welfare are raised to reasonable standard. Folami assured LASACO Assurance that the governor will continue to pay the premium, pointing out that insurance by this arrangement has made meaning to the life of the people and will be sustained. The insurance scheme, which started in 2009 paid total of 174 beneficiaries in 2013 and 2016. And for this year(2017) being the third in the series, 85 beneficiaries got cheques consisting of 50 local government and 35 SUBEB deceased staff. According to the guidelines for life insurance policy for employees jointly issued by the National Insurance Commission (NAICOM) and National Pension Commission (PenCom), the employer is required to fully bear all costs in relation to procurement of this policy, and this shall be in addition to the contributions to be made by the employer to each employee’s Retirement Savings Account. The policy provides cover to the insured against death and the insurance cover is mandatory for all employees as long as they are in employment. This means that the policy provides for the payment of the sum assured in the event of the death of a member of the scheme from any cause, natural and accidental. PILA strengthens insurance awareness efforts across secondary schools Committed to creating awareness and ensuring that young generation of Nigerians across secondary schools appreciate, understand and take insurance as a career, the Professional Insurance Ladies Association (PILA) has held its 2017 edition of ‘PILA Career Talk for Secondary Schools’. Jocelyn Ogbuokiri, president, PILA who spoke at the 2017 Career Talk for secondary school students organized by PILA at the Nigerian Institute of Advanced Legal Studies, University of Lagos Said,: “Deepening insurance awareness, appreciation and understanding among the young generation is one of the cardinal objectives of the Professional Insurance Ladies Association. The Career Talk is one of the ways we aim at achieving this purpose.” Ogbuokiri noted that besides providing avenue for better appreciation of the workings of insurance as a life tool, the Career Talk also provides a very good boost for the upcoming generation to decide for insurance as a Career having had the opportunity of interacting first hand with very successful professionals. “As an icing on the cake, we have designed a Mentoring Program this year, that will get interested students attached to Mentors that will guide them successfully through their career path as they decide for insurance.” She said this year’s theme “ Empowering the Next Generation of Insurance Practitioners” has been carefully thought out to reflect our passion to adequately equip the young generation with the requisite knowledge and counseling that will enable them effectively take charge of the insurance industry in Nigeria in their time.
Wednesday 24 May 2017 In Association with BUSINESS DAY 23 PensionToday E-mail: insurancetoday@businessdayonline.com C002D5556 As multi-fund structure sets to change pension industry investment dynamics …carters for individual investment preferences ...variable income instruments get boosts The multi-fund structure in the newly amended investment guideline recently released by the National Pension Commission (PenCom) when implemented would change the pension industry investment dynamics. Pension Fund Administrators (PFAs), the mangers of the burgeoning country’s pension funds are positive that new scheme would carter for individual investment preferences. Besides that, it will give younger contributors who still have long period to retire, theopportunity ofearning higher returns on investmentin the variable income instruments. PenCom recently released the amended investment guidelines introducing multi-fund structure comprising Fund I, Fund II, Fund III and Fund IV (Retiree Fund). Funds I, II, III and IV shall however differ among themselves according to their overall exposure to variable income instruments. According to the guideline, the exposure to variable income instruments is defined as the sum of a PFA’s investments in ordinary shares and participation units of open close-ended and hybrid funds; real estate investment trust; infrastructure funds; and private equity funds comprising its current holdings and any future financial commitments to the acquisition of participation units in these funds. Eguarekhide Longe, managing director/CEO, AIICO Pensions Limitedsaid the multi-fund structure means that individual investment preferences will be catered for just like in the regular asset management industry. Longe, who is also the chairman of Pension Fund Operators Association of Nigeria (PenOp) said for younger contributors capable of absorbing more risk, they will have the option of selecting the funds with larger variable income exposure, while those who would rather be more conservative, due to age, will select the more predictable fixed income funds. “One size will not be compelled to fit all as currently obtains.” According to him, enhancement of returns is not the focus of the new fund structure but rather, it is for risk predisposition. Longe further emphasized that experience over the years show that variable income investments (e.g. equities) tend to outperform other asset classes, so “it is expected that for those with a longer term investment horizon, they will ride the fluctuations over the years and earn superior return over the life of the investments that will be made for them in the portfolios that are exposed to higher risks.” Glory Etaduovie, managing director/CEO, IEI-Anchor Pension Managers Ltd said that the multi-fund structure is designed for proper definition of available funds for types of investments, long term and short term to suit various developmental needs and stimuli for sustainable growth. “Pension funds are a delicate fund which needs to be managed delicately. It is not free money as many seem to allude to in recent developments. It is the people’s future and it will be immoral to deal treacherously with the funds because the future generations will judge us.” He noted that the funds are graded to determine use to which it may be used safely. “Portions of funds for those nearing retirement cannot be used for long term investments. Younger contributors will not need their contributions in the very near future, so it can be stud- ied for sustainable development”. You will observe I keep mentioning’ sustainable development,’ it refers to a well rounded out investment/development plans where no sector suffers the aftermath of lope-sided investment decisions. It is good for the government; it is good for the public and the citizenry.” According to him, contributors will make double gain - the funds will be structured in a way that nothing that accrues to them will be taken away. It will also be wasteful to let the funds lie idle, not being productive economically. Contributors are part of the society and so they will also benefit from meaningful infrastructural developments.” Etaduovie further contended that everything about the new fund structure is exciting, as it excites increased study and financial intelligence being developed in the country now. “It is also going to attract bigger business ideas needing long term funds. Everyone stands to gain - the pension industry will be seen as a worthy growth and development partner, the citizenry, economy and the government will all gain, Etaduovie stated. In line with 7.3(a) of the guideline, the maximum exposure to variable income instruments by the Fund types are as follows: Fund I: 75 percent of portfolio value; Fund II: 55 percent of portfolio value; Fund III: 20 percent of portfolio value and Fund IV: 10 percent of portfolio value. PFAs are also expected to invest in such a way that the actual exposure to variable income instruments in Fund I is higher than the exposure in Fund II. Likewise, the exposure in Fund II shall be higher than the exposure in Fund III. Accordingly, the minimum exposure to variable income instruments by Fund Type shall be: Fund I: 20 percent; Fund II: 10 percent; Fund III: 5 percent and Fund IV: 0 percent. Effective from the date of implementation of the multi-fund structure, the PFAs shall allocate contributors to various fund types according to the following criteria: membership of Fund I shall strictly be by formal request by a contributor; active contributors who are 49 years and below as at their last birthdays shall be assigned to Fund II; active contributors who are 50 years and above as at their last birthdays shall be assigned to Fund III and Fund IV shall strictly be for RSA retirees only. RC634453 Diamond Pension Fund Custodian Limited 1A, Tiamiyu Savage Street, Victoria Island, Lagos State. Tel: 01-4613753, 2713680, 2713954 Fax: 01-2713955 Email: info@diamondpfc.com Website: www.diamondpfc.com This section is created to increase awarness and deepen knowledge about the contributory pension scheme. If you have enquiries or contributions, send to this e-mail: diamondpfcbusday@yahoo.com
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BusinessDay 24 May 2017

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