In a manner that could further scare away prospective clients and worsen public perception of the industry, Standard Alliance Insurance Company has continually defaulted on payment of N1.44 million benefit to Mack Abdul Ogbamosa, months after issuing a discharge voucher.
Also, the inability of the company to make the payments, which by law, ought to have been made within seven days after issuance of discharge voucher, is seen by industry watchers as a signal of insolvency.
The default by Standard Alliance which had been reported since April to the industry regulator, the National Insurance Commission (NAICOM) but which the commission has refused to act upon, has therefore cast doubt on its ability to protect policyholders who are in dire need of its intervention in cases like this.
The insurance firm in a discharge voucher to Mack Abdul Ogbamosa on 5 April on the policy referenced IPP/10/0007796/IKJ, and witnessed by one of its staff, Ololade Fajobi, claimed payment of N1.44 million as full settlement of termination benefit due on the policy.
The Voucher signed by Ogbamosa in the presence of the account officer on the policy, Mrs Fajobi, read “I hereby give Standard Alliance Insurance Plc full and complete discharge of its liabilities under this policy in respect of the Termination value and relieve Standard Alliance Insurance Plc of any future claim which could be made against it by virtue of this policy by me or anyone whomsoever, for the Termination value hereby claimed”.
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Ogbamosa also noted that the underwriter should make payment in satisfaction of his application for the full benefit by crossed cheque drawn in his favour.
Five months after the discharge voucher, Ogbamosa, who terminated his income protection policy in a bid to save the life and pay medical bills of his critically-ill daughter, is still at the mercy of the insurance firm which has continually defaulted on its part of the deal.
Ogbamosa, who had sent several pleas to the management of the company and also to NAICOM for its intervention on the payment, procured an Income Protection Plan (IPP) policy in November 2009. The policy which sum assured was N12 million, was to last for 10 years.
The insured started contribution same year but had to terminate the policy owing to the deterioration of the daughter’s health who is currently undergoing treatment for leg ulcer which has taken toll on his financials.
“I had contributed more than N3.3 million. I decided to terminate the policy because my daughter’s health condition deteriorated. I needed the money to settle hospital bills. I collected N2 million as a form of loan with interest from Standard Alliance with my policy as collateral in October 2017 when my daughter was first admitted to National Orthopedic Hospital, Igbobi for leg ulcer surgery”, noted Ogbamosa
He sought the intervention of the National Insurance Commission (NAICOM) on 22 April but his efforts had been in vain as Ogbamosa is still owing the hospital and currently considering selling some assets to offset the medical bills so the daughter could return to school.
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In the 22 April letter to seek the commission’s intervention, Ogbamosa noted that “I requested to surrender my Policy No IPP/10/0007796/IKJ on 11 February 2019 and has since signed the discharge voucher from the company. I do not know why the payment is being delayed”.
Up till today, NAICOM has yet to acknowledge the letter sent to the complaint unit of the commission for the attention of Mohammed Ibrahim, the head of the unit.
This means that the commission has not acted on Ogbamosa’s request for help, and further, cast doubt on the responsiveness of the industry regulator which part of its functions is to protect policyholders.
Efforts to also talk to Richard Ododo, the managing director of the company have also been rebuffed as he continually shunned phone calls and messages.
This development has shown that the industry is not prepared to turn its image around for the better. It has also shown that NAICOM is not doing enough to compel attitudinal change in the industry which has for decades, battled poor image resulting from refusal to honour genuine claims.
Standard Alliance Insurance’s attitude is a reminder to the March 24 2017 ruling when a Lagos High Court Igbosere had to compel it to pay N47 million to Ravega Construction and Project Management limited. The ruling was for the default by the underwriter on the outstanding sum for the construction of its corporate head office in Lekki Lagos.
It will be recalled that the industry some years ago set up a committee which pooled some millions of Naira, primarily to smoothen its image and improve public perception of the the sub-sector, industry watchers say issues like this could prevent the committee from meaningful achievement.
Default like this has bred poor image which is contributory to the low penetration of the industry in Nigeria.
Statistics according to a report by Proshare shows that Nigeria has the lowest insurance penetration level of 0.3 percent (measured as insurance gross premium written as a proportion of GDP) amongst notable African countries – South Africa (14.7%), Kenya (2.8%), Angola (0.8%) and Egypt (0.6%).
Similarly, the sector’s insurance density (a measure of industry gross premium per capita) is still one of the lowest when compared to peers like South Africa (US$762.5), Egypt (US$22.8), Kenya (US$40.5) Angola (US$30.5) and Nigeria (US$6.2)
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