More than 18-months after regulatory intervention, the National Insurance Commission (NAICOM) has formally transferred operational control of African Alliance Insurance Plc to a newly constituted Board nominated by the company’s shareholders.
In October 2024, the insurance sector regulatory authority intervened in the management of the company, which was mired in severe liquidity challenges, a backlog of unsettled claims, particularly annuity obligations, regulatory breaches, and reputational damage that threatened its continued existence and undermined policyholder’s confidence.
Apart from appointing an Interim Management Board (IMB), NAICOM constituted an interim management team with a clear mandate to stabilize the company, unlock liquidity, settle outstanding liabilities, conduct forensic and actuarial reviews, and restore stakeholder confidence.
The Company now has a new Managing Director in the person of Mr. Abayomi Olakunle Ogunkeye and Rear Admiral Anthony Odogba Isa as the new Chairman.
Following the successful conclusion of a regulatory intervention, the Commission resolved to handover the company to a reconstituted Board, describing the decision as a significant milestone in restoring the company’s financial stability, safeguarding the interests of policyholders and annuitants, and repositioning the organization for sustainable growth.
The Commissioner for Insurance and Chief Executive Officer of NAICOM, Mr. Olusegun Ayo Omosehin, who spoke at the handover ceremony in Abuja, highlighted the transformative impact of the newly enacted Nigerian Insurance Industry Reform Act (NIIRA) 2025.
The legislation, Omosehin noted, has strengthened regulatory oversight, enhanced public confidence, and supported deeper insurance penetration in Nigeria.
He said a major milestone under the Act was the establishment of the Insurance Policyholders Protection Fund (IPPF), a landmark mechanism designed to provide financial relief to policyholders in the event of insurer distress, insolvency, or liquidation.
The Fund, the Commission explained, represents a significant advance in consumer protection and aligns Nigeria’s regulatory framework with global best practices.
Mr. Omosehin observed that if the IPPF was operational prior to the challenges that affected African Alliance Insurance Plc, it could have played a critical role in cushioning the impact on policyholders by facilitating the timely settlement of legitimate claims and annuity obligations.
This, he noted, would have reduced uncertainty and strengthened confidence during the transition period.
The Commissioner charged the newly constituted Board of Directors to work collaboratively with shareholders while upholding the highest standards of corporate governance, regulatory compliance, and operational transparency.
He emphasized the importance of sustaining policyholder confidence through prompt claims settlement, sound solvency management, and prudent business practices.
The Commissioner further directed the Board to strengthen the company’s corporate governance structures; restructure its portfolios; update and reconcile policyholder records and reinforce transparency and accountability in its operations.
In his remarks, Chairman of the outgoing Interim Management Board, Dr. Haruna Mustapha, thanked NAICOM for its guidance and support throughout the intervention period.
He assured stakeholders that the new Board would build on the progress achieved and sustain a culture of regulatory compliance, sound risk management, and strong corporate governance.
Mustapha said the interim management board recorded significant milestones during it tenure, including restoring liquidity in the system and ensuring the settlement of arrears; securing trapped dividend funds and other inflows, and enabling the settlement of a substantial backlog of annuity arrears, at one point up to 15 months as well as numerous legacy claims, thereby protecting vulnerable annuitants and policyholders.
Other achievements included strategic asset realizations by successfully executing the competitive sale of 49% of the company’s stake in an investment, achieving a material improvement over prior offers and unlocking funds to meet pressing liabilities and operational needs.
Also, he said his management was able to transfer annuity portfolio by facilitating the transfer of the admitted annuity portfolio to a capable underwriting institution through a transparent process, ensuring continuity of payments to beneficiaries and reducing liquidity pressure on the company.
In addition, he said the company carried out forensic and actuarial reviews by
completing a comprehensive forensic and actuarial audit covering recent financial periods, with findings submitted to NAICOM to enhance transparency and guide governance and risk reforms.
Besides, Mustapha said corporate housekeeping and compliance were taken seriously as outstanding audits were concluded, while addressing regulatory breaches, settled selected legacy liabilities, resolved legal impediments, including disputes affecting dividend income and advanced preparation for IFRS 17 compliance.
On operational stabilization, he said the company implemented critical operational measures, including remediation of ICT vulnerabilities, and maintenance of essential business functions, thereby preserving enterprise value and preparing the company for relaunch.
Although NAICOM emphasized that the handover reflects the success of the stabilization programme, the Commission said the company would remain under regulatory oversight as solvency levels, recapitalization progress, and compliance with prudential standards continue to be closely monitored.
