Data released by the National Insurance Commission (NAICOM) has indicated that the insurance industry life annuity fund portfolio has grown to N322.9 billion as at the end of the second quarter of 2019.
This represents a growth of 17.46 percent from N274,9bn as at end of fourth quarter, 2018. An annuity, is a series of payments at fixed intervals, paid while the purchaser (or annuitant) is alive. To help retirees manage their contributions after they might have retired, the Pension Act provided that they have the options of buying life annuity products from insurance companies.
The report released by the NAICOM’s Head, Commissioner for Insurance’ Directorate, Mr. Rasaaq Salami also indicated that “within the same period under focus, the cumulative total retirement life annuity (RLA) payouts stands at N122.1bn, and N395.1bn during the period.
The RLA market has been in existence since the advent of the Contributory Pension Scheme (CPS). The report indicated that the RLA portfolio so far has recorded 73,554 contracts purchased for a total premium of N341.6bn by Q2, 2019. This depicts 13.02 percent and 6.21 percent growth in count and volume, respectively in 2019 from end of Q4, 2018.
“The annuity payouts, premium receipts and portfolio fund balance depicts a clear representation as the difference between the cumulative premium amounts received and fund balance now stands at N18.6bn, compared to the cumulative annuity payouts earlier stated” the report indicated.