The National Insurance Commission (NAICOM) said insurance companies are not statutorily required to contribute percentages of their insurance funds to the housing sector.
The insurance industry regulator was reacting to the House of Representatives Ad hoc Committee investigating non-remittance of workers contribution to the National Housing Fund (NHF) and utilisation of the funds from 2011.
The House of Representative Ad hoc Committee lamented that insurance companies had over time failed to remit about N267 billion to the Federal Mortgage Bank for the National Housing Fund since 2019.
The Chairman of the committee, Hon. Dachung Musa Bagos, had alleged that “insurance companies are statutorily required to contribute 20 per cent of their non-life and 40 per cent of their life fund to the housing sector, but the management of the Federal Mortgage Bank said this contribution had not been forth coming”.
Reacting to this remark, an official of the NAICOM told The Nation that “the insurance Act only authorises general insurance companies to invest not more than 20 percent of their insurance fund and not more than 40 percent for life insurance companies.
“These investments he said are sourced from the premium paid by policy holders and must be accounted for. Any insurance company that invests more than the law stipulates he said will be sanctioned” he said.
Making such investments he said is entirely at the discretion of the insurance company that wants to do so. “It is an investment decision”
The NAICOM official agreed that individual insurance companies were mandated by law to make contributions on behalf of their staff to the NHF, however, “there is no law mandating insurance companies to invest in the housing sector”
Bagos had asked the insurance regulatory body to come along with evidence of their remittances to FMBN, adding that they should also provide evidence of sanctions to those who had defaulted.
According to him, in 2019 alone 54 insurance companies did not remit N267 billion. “They need to tell us where the money is. This figure does not include 2020 to 2023,’’ Bagos said.