Anxiety as FG calls bidders for Group life insurance

Chuks Udo Okonta

The Federal Government, having failed to provide insurance for its workers last year, has embarked on another journey to cover employees this year, by calling for bidders to underwrite their risks.

The Head of the Civil Service of the Federation, in a publication had called for bids from registered insurance companies to provide life assurance cover for all its employees in compliance with the Pension Reform Act 2004 for the year 2014/2015.

The publication noted that the opening of bids will be held on Monday, March 3 2014.

Industry observers are skeptical over the working of this year’s Group life insurance for workers, as factors that stalled the business last year, are still unresolved. They expressed worry that underwriters in line with the No premium No cover policy would reject risks that would have occurred prior to when the premium is paid.

They noted that opening the bids in March, which is the last month in the first quarter of the year, will create room for misunderstanding between government and underwriters as some claims would have been incurred from January to March.

Another cause of worry is the readiness of budget for implementation at the end of the first quarter of the year. They suggested that government should move the renewal dates for its agencies to the second quarters to make up for delays in the approval of the budget.  

“Earnestly, government is the highest spender and they are to promote the insurance industry. What the government should do because of delay in implementation of the budget is for most agencies to move their renewal period from January to April ending or June. If they do that, they would have enough time, after the budget is released to get their premium,” an operator said.

Director-General, NIA, Sunday Thomas, said the operator have resolved to abide by the rules, adding that operators cannot continue to sell services on credit and when claims come they pay.

He added that nonpayment and delays are not good for business, as operators need to invest the money they realised as premium to able them pay claims.

“For the first time the industry is taking the decision to face the reality.

“We have decided to take the bull by the horns by letting government know that the industry is under threat and that unless the government begins to show support for the sector, other corporate clients will continue to take the industry for granted,” he added.