Finance Ministry insists on 5% tax on data, calls

By Favour Nnabugwu

 

 

 

Ministry of Finance has insisted that 5percent tax would be deducted on data and calls

The Minister of Finance, Budget and National Planning Zainab Ahmed, stated that proposed 5 percent Telecommunication Tax on calls and data.

In a statement, the Special Adviser on Media, Mr. Tanko Abdullahi, in Abuja, yesterday, the minister cited the Finance Act 2020 as the enabling legislation for the tax.

The Minister of Communications and Digital Economy, Dr. Isa Pantami had opposed the tax which he said was ill-timed.

However, the Finance Minister said she would implement the tax on all voice calls, SMS and data services, in addition to the existing 7.5 percent Value Added Tax (VAT), paid for goods and services across all sectors of the economy.

The five percent excise duty came to the fore during a recent stakeholders’ meeting, organised by the Nigerian Communications Commission (NCC), the telecoms industry regulator.

At that meeting, Mrs. Zainab Ahmed, Minister of Finance, Budget and National Planning, who was represented by the Assistant Director, Tax Policy, Federal Ministry of Finance, Budget and National Planning, Musa Umar, noted: “The five percent excise duty has been in the Finance Act 2020, but has never been implemented.

“Henceforth, the five percent excise duty will be collected by telecom operators and payment made to the federal government on a monthly basis, on or before 21st of every month.”

Against the comments by Dr. Pantami, concerning the five percent excise duty hike on telecoms services, Mrs. Ahmed said that there was a circular stating the planned hike which was addressed to the Communication Minister and other relevant ministries and agencies of government.

According to her, “The circular Referenced No. F. 17417/VI/286 dated 1st March 2022, and titled “Approval for Implementation of the 2022 Fiscal Policy Measures and Tariff Amendments” was addressed to different Ministers, including Honourable Minister, Communications and Digital Economy and other heads of government agencies.

The circular was addressed to The Secretary To The Government of The Federation, Attorney-General of The Federation, Ministers of Industry, Trade an Investment, Agriculture and Rural development, Mines and Steel and Development.

“It, therefore, means that all stakeholders have by that singular provision been aware of the Act.

“The excise duty on telecommunication services provided in Nigeria introduced through the Finance Act, 2020 with statutory enactment on 1st January, 2021 is yet to be implemented considering the need to ensure reasonable transition period before the implementation of the new tax, as well as providing clarity to all stakeholders on implementation modalities.

“As a matter of emphasis, Mrs. Ahmed had vide Circular dated 1st March, 2022 informed the Nigeria Customs Service (NCS) and other heads of government ministries, departments and agencies (MDAs), including the Federal Ministry of Communication & Digital Economy about Mr. President’s approval of the implementation of the five percent excise duty on telecommunication services with effect from 1st June, 2022.

“An issue as serious as the excise tariff cannot be taken single handedly, as all stakeholders and agencies have been involved including Manufacturers Association of Nigeria (MAN) and Association of Telecom Operators of Nigeria (ALTON), who wrote to the Ministry to be involved in the modalities for implementation of the excise duty.

Mrs. Ahmed added that the National Assembly passed the Finance Bill before President Muhammadu Buhari signed it into law and that by so doing, the legislature supported the telecom tax.

She added that many countries in sub-Saharan Africa such as Tanzania, Uganda, Malawi, Kenya, Rwanda, Ghana and Burundi currently impose excise duty on telecommunication services ranging between five percent to 20 percent and that Nigeria should not be an exception.

Africa Re’s underwriting profit increase by 146.21% in 2021

By Favour Nnabugwu
Africa Reinsurance Corporation (Africa Re), the leading pan-African reinsurer announced a net underwriting profit increased by 146.21 percent to stand at US$ 34.56 million
The gross written premium by 5.04 percent in 2021 to reach US$ 845. 35 million.
Speaking at it’s 44th Annual Ordinary Meeting of the General Assembly held recently in Cairo, Dr Mohammed Maait Chairman of the Board of Directors and the General Assembly of Africa Re, stated that investment and other incomes also grew to US$ 54.14 million thanks to the Corporation’s investment strategy that prioritises the preservation of capital and liquidity.
Maait further stated that the company’s  feat was dampened by the depreciation of the functional currencies against the dollar, our reporting currency.
He said the situation resulted in a considerable loss of US$47.78 million (compared to US$9.25 million in 2020). This has seriously affected the overall net profit of the Corporation which stood at US$ 38.42 million (against US$55.71 million in 2020).
He added that the reinsurer’s shareholders’ equity remains stable at US$ 1 billion despite a slight decline of 1.6 percent”
He added that the efforts and determination behind these good results have been recognised by Standard & Poor’s and A.M. Best international rating agencies. Standard & Poor’s and A.M. Best reconfirmed the financial strength of the Corporation at “A-“ with stable outlook and “A” with stable outlook respectively.
Dr Maait also highlighted some other key milestones achieved by the Corporation in the last 12 months, namely its preparation to meet the requirements of COP 26 in relation to climate change ; the advanced stage of compliance with IFRS17; the African insurance Awards; Young Insurance Professionals Programme; the official inauguration of the Africa Re DIFC in Dubai and continued disbursement of the pledged Covid-19 intervention of US$ 3.32 million.
Africa Re’s General Assembly decided that the 2021 net profit of US$ 38,823,000 be distributed as follows: “US$ 19,412,000 to the general reserve in accordance with Resolution No. 4/1992 which stipulates that 50% of the net profit after tax of each year is set aside as general reserve; “US$ 1,000,000 to be transferred to the reserve for loss fluctuation in accordance with the decision taken by the board during its 57th meeting to set aside an amount over and above the outstanding claims provision to moderate the effects of possible fluctuation in losses in future. ”US$ 576,000 to be transferred to the Africa Re Foundation as 1.48% of net profit. US$ 25,200,000 to be paid as dividend at the rate of US$ 8.8% (2020: US$ 8.8 % ) per subscribed and paid-up share of US$100 par value.
ARC to fight climate change in Africa continent

By Favour Nnabugwu

 

 

The African Risk Capacity Insurance Company (ARC) plan to address the role of insurance in fighting climate change impacts on the African continent.

African Risk Capacity, from ARC member states and funding donor partners met in Malawi to discuss how parametric insurance has the potential to transform how the continent deals with climate-change-induced events such as droughts and cyclones.

ARC has made a record payout of almost $60 million in claims this year, protecting Africa’s most vulnerable against the worst impacts of extreme weather.

A significant $797,049 cheque was issued by ARC and the African Development Bank to the Government of Madagascar earlier this year as an insurance payout after delayed rains caused draught during the 2021-2022 agricultural season.

The meeting brought together key stakeholders in the ARC ecosystem to address the challenges and opportunities of working together to fight the impact of climate change

Addressing delegates, ARC Limited CEO, Lesley Ndlovu, commented on the value of ARC on the African continent.

“In the history of ARC, we have paid about US$125 million in claims and half of that was in last year’s Pool 8. We are extremely happy when we pay claims because these go towards meeting the needs of Africa’s most vulnerable people. These payouts also demonstrate the value of the insurance mechanism.”

“Further, the fact that about half of the claims paid were paid by the insurance
market means that ARC is able to take weather-related risks on the African continent and seed them into global markets such that when there’s a disaster on the African continent, part of the payment for the cost of that disaster also comes from the global reinsurance markets, again demonstrating the value of having a mechanism like ARC.”

During the session, representatives from Malawi, Mali, Madagascar and Zambia, all shared their insights on how the ARC insurance mechanism had supported their risk management programmes in the last year.

In the meeting, ARC also expanded on the intention to increase coverage in wider countries.

The overreaching goal, Ndlovu shared with delegates, was to increase the participation of African countries in its insurance programme and position ARC as Africa’s premier institution for disaster risk financing.

“Currently, we have 13 countries that participate out of 55 on the African continent. We need more to participate, and are also working very hard to bring partners into the ecosystem so we are able to overcome the two main barriers we face in the growth of insurance – the affordability of premiums and increasing capacity building so there is greater understanding of the role of insurance in disaster risk management.”

Ndlovu concluded the event by saying, “We all know that Africa is a continent that is most exposed to climate-change-related risks and with ARC we have in our hands an instrument that can play a vital role in creating the solution to protect the most vulnerable African citizens against the worst impacts of extreme weather. It really is up to us to make this initiative a success.”

Three insurance companies to sponsor NAIPCO new executives August 25

By Favour Nnabugwu

 

Three insurance companies are set to sponsor the inauguration of the new executive of the National Insurance and Pension Correspondents, NAIPCO on August 25, 2022.

The companies are Anchor Insurance Company Limited, Sovereign Trust Insurance Plc, and Universal Insurance Plc

The inauguration which comes up on 25th of August, 2022 will take place at the Radisson Hotel, Isaac John, GRA, Ikeja.

It will be recalled that NAIPCO recently elected new executive officers to oversee the affairs of the Association in the next two years.

NAIPCO is the umbrella body for journalists covering insurance and pension sectors in Nigeria.

At the general election conducted recently, the following officers were elected: Nkechi Naeche-Esezobor, Publisher/Editor-in-Chief, Business Today (Chairman); Ngozi Onyeakusi, Publisher/Editor-in-Chief, Super News Online (Vice Chairman); Rosemary Iwunze, Insurance/Pension Editor, Vanguard Newspaper (General Secretary).

Others are Edet Udoh, Publisher/Editor-in-Chief, the Revealer Online (Assistant General Secretary); Adejoke Adeyemi, Insurance and Pension Editor, News Agency of Nigeria (NAN) (Treasurer); Matthew Otoijagha, Publisher/Editor-in-Chief, Business Wrap Online (Financial Secretary); and Amaka Obiefuna, Publisher/Editor-in-Chief, News Corner Online (Public Relations Officer).

Speaking on the sponsorship, Chairperson of NAIPCO, Nkechi Naeche-Esezobor said that the Association appreciates the efforts of the three companies to sponsor the inauguration of the new executives.

According to her, these companies have always been partners of the Association and have deemed it worthy to support every initiative of the Association.

Public sector employers’ Pencom contribution in 2021 declined by 8.9% – PenCom

By Favour Nnabugwu

 

 

Public sector employers in federal, state and local governments contributed N492.43 billion as pension in 2021 as shown in the  National Pension Commission (PenCom) 2021 annual report

The figure represented an 8.29 per cent decline (year-on-year) when compared with the N536.97 billion recorded in 2020.

The Director-General of PenCom, Aisha Dahiru-Umar, admitted in the report that COVID-19 restrictions slowed down operations of the commission in the year under review.

PenCom said despite that, it paid N326.32 billion as retirement benefits.

The payments comprised retirement benefits and a 25 per cent payout due to temporary loss of job.

The commission noted that pension contributions credited into the Retirement Savings Accounts (RSAs) of public sector employees from inception grew from N3.43 billion on December 31, 2020, to N3.93 billion by December 31, 2021.

It added that the cumulative pension contribution received from the private sector from inception to December 31, 2021 rose from N3.27 billion recorded in 2020 to N3.66 billion.

The pension contribution credited into the RSAs of private sector employees also increased slightly by 4.61 per cent from N371.12 billion in 2020 to N388.23 billion by December, 31, 2021.

Total pension contributions remitted into the RSAs of employees, however, dropped to N880.66 billion at the end of 2021, representing a 3 per cent decline compared to the N908.09 billion recorded during the corresponding period in 2020.

“The total pension contributions remitted into the RSAs of employees in both the public and private sectors in 2021 decreased slightly from N908.09 billion recorded in 2020 to N880.66 billion as of December, 31, 2021.

“This indicated a 3.02 per cent decline over the reporting period,” the report stated

AIICO Insurance grows GWP by 21.4% in H1 2022 

By Favour Nnabugwu
AIICO Insurance Plc, foremost and most resilient insurance services provider has announced a gross written premium (GWP) of N45.5billion in the H1 2022, up by 21.4per cent compared with N37.481billion recorded within the same of in 2021.
The company’s unaudited results represent the firm’s performances for the interim period ended 30 June 2022 I which it’s group grossed N45.5bn year-on-year (y-o-y) in the first half of the year from N37 bn or 21.6per cent within the period under review.
This was due to a y-o-y increase of 39.4per cent in General Insurance to ₦15.5 bn (H1 2021: ₦11.1 bn). Life Insurance premiums increased by 14.2per cent y-o-y to ₦29.6 bn (H1 2021: ₦25.9 bn) and underwriting income from our Health Maintenance Organization (HMO) increased by 31.4per cent y-o-y to ₦599.9 m (H1 2021: ₦456.4 m)
AIICO Insurance also earned gross premium income of N40.573bn or 17.8per cent from N34.435bn or 17.9per cent from respectively.
Conversely, net premium income which refers to gross premium income less applicable reinsurance expense stood at N34 bn for the company or 16.7per cent compared with the group’s N33.671bn and equally 16.7per cent growth.
The operating income in Asset Management however declined by 9.5per cent y-o-y to ₦697.6m (H1 2021: ₦770.5 m). Profit before income tax from continuing operations increased by 146.9per cent y-o-y to ₦2.2 bn in H1 2022 from N908.6m in H1 2021.
Profit before income taxes across the company and its subsidiaries increased y-o-y contributing to the reported increase for the period. The company said this was due to improved top line and investment performance for the period compared to H1 2021.
AIICO also completed the sale of its stake in AIICO Pensions, recording a profit from discontinued operations of ₦2.9 bn. As a result, profit for the interim period rose by 51.4per cent to ₦4.9 bn in H1 2022 from the H1 2021 -₦3.3 bn.
Commenting on the results, Mr. Babatunde Fajemirokun, the Managing Director and Chief Executive Officer said, “Our half year results are a testament to the resilience of our business model, our focus on AIICO Insurance Plc.”
“Creating products that our customers need to navigate uncertain periods in their lives and the trust that our customers have that we will be there when they need us. Every insurance policy we sell is a contract with our customers and a promise that we take very seriously.
“For us at AIICO Insurance, all our efforts are geared towards ensuring that our customers can believe us when we say that we are here for the long haul, come rain or shine,” said Mr Fajemirokun.
CIIN president, Edwin Igbiti visits NAICOM to strengthen ties

The President of the Chartered Insurance Institute of Nigeria, CIIN, Edwin Igbiti led a delegation on a courtesy call to National Insurance Commission, NAICOM in Abuja.

CAPTIONS:

President of the Chartered Insurance Institute of Nigeria, CIIN, Mr Edwin Igbiti; Commissioner For Insurance, Mr Sunday Olorundare Thomas and Alhaji Bala Zakariya’u, top member of the CIIN during the visit to NAICOM

L- President of the Chartered Insurance Institute of Nigeria, CIIN, Mr Edwin Igbiti and  Commissioner For Insurance, Mr Sunday Olorundare Thomas

L- Deputy Commissioner for Insurance, Alhaji Sabiu Abubaka, President of the Chartered Insurance Institute of Nigeria, CIIN, Mr Edwin Igbiti and  Commissioner For Insurance, Mr Sunday Olorundare Thomas, Firectpr-General of Chartered Insurance and Financial Management, CIFM, Mrs Abimbola Tiamiyu; Alhaji Bala Zakariya”u and a delegate during the vist

NEPZA boss charges Ondo Chambers to develop special agro-allied district

By Favour Nnabugwu

 

 

The Managing Director of the Nigeria Export Processing Zones Authority (NEPZA),
Prof. Adesoji Adesugba, has advised the Ondo Chambers of Commerce Industry Mines and Agriculture (ONDOCIMA) to actively partner with Ondo State to establish a special agro-allied district for the production and processing of agricultural produce for export for economic growth of the state

Adesugba gave the advice while playing host to the new executive of the chambers in Abuja on Thursday.

The NEPZA boss, himself a pioneer member of that branch of the association, said that chamber movement was aimed at galvanising sound economic development, adding that ONDOCIMA was set up to make indelible and positive economic impact in the state.

“The chambers must without further delay constitute itself as an active development partner of the state by making itself an economic spring board in the state.

“This can happen speedily if a special agro-allied district for backward linkages in the production and processing of agricultural produce can be established.

“The new executive must begin to contemplate on securing large expanse of land in the state to establish this project as the enclave help to provide jobs and variety of businesses for members and residents of the state.

“Ondo State is blessed with arable land, suitable for all-year-round- farming. The association can also reserve a substantial portion of the proposed district for the production of cocoa which the state has comparative advantage on,’’ Adesugba said.

He explained that the pioneers of the state branch of the association had hatched the plans of having such a special agric site and other businesses as well, adding that a number of extraneously factors had made these dreams unrealisable.

“The chambers can only record good successes if it is less dependent on government. The leadership must activate interest and expertise of the members in order to achieve the set goals,’’ Adesugba said.

In a statement issued by Head, Communication of NEPZA, Mr Matthew Odeh, the Chief Executive noted that the association could become more potent and resulted-oriented if it regularly underwent projects’ assessment visitations to other sister associations, adding that members would use such tours for business knowledge acquisition and investment promotion exchanges.

Adesugba, therefore, said that NEPZA was prepared to partner the association in developing world class business templates that could make it become investment forerunner in the state.

The NEPZA boss explained also that the existence of the Akoko Chambers of Commerce, an adjunct of ONDOCIMA, which he assisted in establishing was a testament of years of strive to ensure that must local communities in the state were linked to the Organised Private Sector (OPS).

NEPZA MD and the ONDOCIMA executive during the visit in Lagos

 

Hon. Olugbenga Araoyinbo, President, ONDOCIMA, expressed delight on the warmth reception extended to him and his entourage by the NEPZA chief executive, adding that the visit was indeed an eye opener.

Araoyinbo said that Adesugba had continually proven that his appointment by President Muhammadu Buhari to led the movement of industrializing the country through the Free Trade Zone scheme was not a travesty.

He, however, explained that the new executive of the association had opened a new chapter in the administration of the chamber movement in state, adding that the association was prepared to join forces with the government in growing the economy.

“We are indeed grateful for the suggestion that the association establishes an agro-allied district where our members and investors can be involved in mechanized farming and processing of farm produce for local use and export.

“The association will in this light collaborate with NEPZA, our national body, the state government and investors to ensure that this plan is brought to fruition,’’ Araoyinbo said.

Mrs Modupe Olakunle, the immediate past President of the association, Dr Funmilola Williams, President, Akoko Chambers and Hon. Adeboro Onibalusi, PRO, ONDOCIMA were the video other officials on the entourage of the ONDOCIMA president.

Coronation Insurance rakes N8.6 bn premium income in 2021

CAPTION
The Managing Director of Coronation Insurance, Mr. Olamide Olajolo
By Favour Nnabugwu
Coronation Insurance has announced a gross premium income of N8.6 billion in the financial year ended December 31, 2021 compared to the N12.3 billion the company raked in the same period of 2020.
The underwriter witnessed the hike in prices of things generally and economic condition of the country which dwindled businesses even insurance was not left out
The company also posted a profit after tax at N689.6 million at the end of the year in 2021 far below N1.7billion it gained the previous year

The Chairman of underwriting firm, Mutiu Sunmonu, said this in a statement sent to the Nigerian Stock Exchange and Shareholders on the Group’s Audited Financial Results for the Year 2021.

He noted that the Net Underwriting Income was N9.66 billion, adding that N7.31 billion was paid as claims.

Sunmonu submitted that the firm also recorded a total underwriting profit of N1.25 billion, while the investment income stood at N1.51 billion.

He said the firm’s total assets stood at N39.80 billion, adding that a share capital of N11.99 billion; share premium of N4.61 billion; contingency reserves, N3.66 billion; other reserves, N1.75 billion and total equity, N21.59 billion were recorded in the year.

Though the gross written premium was valued at N14.14 billion in 2021 from  N16.2billion generated in the same period of 2020
With reinsurance expenses valued at N3.8 billion, Net premium income stood at N5.3 billion in 2021 from N9.9billion recorded in 2020 while fees and commission income at N642 million in 2021 from N3.9 billion in 2020 drove the net underwriting income to N4.7 billion during the period from N3.9billion billion the year before.
The company paid N5.5billion as claims in 2021, a little below N5 6 billion paid in 2020 while the outstanding claims was N4.4 billion and claims expenses recoverable was N2.9 million in 2021 from N3 bilion in 2020. These reflected a net claims expenses at N1.4billion in the same year compared to previous year, the value for the same purpose amounted to N3 billion.
The claims paid in the year 2021 was put at N5.5 billion, a slight decrease from N5.6 billion in the previous year. However, this was more pronounced on other operating expenses which was valued at N1.4  billion against the N1.1 billion utilized for the same purpose last year as well as on underwriting expenses which were valued at N4.7billion  against N3.9 billion the previous year.
International Energy Insurance acquired 100% by Norrenberger Advisory

By Favour Nnabugwu

 

 International Energy Insurance Plc (IEI) has been taken over by Norrenberger Advisory Partners Limited (NAPL) after it acquired 100 percent stake in IEI following the approval of the National Insurance Commission (NAICOM) .

The acquisition will enable Norrenberger to expand and strengthen its business model to improve its solutions and service distribution to clients across Nigeria.

The Commissioner for Insurance, Mr Sunday Thomas welcomed the new owners and expressed his satisfaction with their interest in the Nigeria insurance industry despite the challenges faced by practitioners in the industry.

The CFI advised the incoming board of the company on the need for training of staff and directors. He also emphasized that the director should be patient to understand the culture, nature as well as principles and practice of insurance because of the peculiarity of the insurance business. He assured the board of the commission’s unparalleled support and cooperation.

The outgoing chairman of the interim board, Ahmed, OON, while handing over to the provisional board of directors emphasized the need for transparency and encouraged the spirit of oneness amongst all stakeholders of the company including its management and staff. He also emphasized the importance of culturalization for the sensitivity of the insurance business.

The chairman of the provisional board, Buka Goni Aji, OON, CFR stated the board’s mission to significantly contribute to the transformation and growth of the insurance industry by leveraging technology and top-notch human capital. He further reassure the regulator of Norrenberger’s cooperation and commitment to strict compliance with laid down regulations while focusing on the growth of the company.

The provisional Board Chairman expressed his gratitude to the outgoing interim board for laying a solid foundation to enable the provisional board to thrive and make its contributions to the development of the insurance industry in Nigeria