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NNPC insurance probe: Investigations reveal strong, sustained claims settlements

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NNPC Releases 2019 Audited Financial Statement, Reduces Loss by 99.7%

Chiamaka Ajeamo – The Nigerian National Petroleum Corporation (NNPC) Group Life Assurance (GLA) scheme claims ratio for the last 10 years have shown a strong and sustained claims settlement, according to investigations.

Analysis of the Corporation’s GLA claim settlement over the first three years shows the highest claims collected under the scheme was in 2011 with N2.09 billion over a premium of N2.42 billion, followed by N1. 88 billion as against a premium of N 2. 69 billion in 2010 and N1.51 billion claims on a premium of N2.03 billion in 2012. In 2014, a premium of N2.65 billion lead to a claim settlement of N2.36 billion. However, claims collected by NNPC in the 2013 and 2015 surpassed premium paid. The claims collected in 2013 was N2.74 billion as against a premium of N2.66 billion while 2015 claims settlement was N2.94 billion for a premium of N 2.35 billion.

Further breakdown of the GLA claims portfolio for the year 2016 displayed a claim of N2.36 billion over a premium of N2.45 billion while 2017 saw a claim of N2.83 against a premium of N2.37 billion. Though, with a slight difference in premium deposited by the corporation in 2018 and 2019, there was a huge gap in claims collected. In 2018 claims collected was N2.47 billion and N2.67 billion in 2019 against a premium of N3.01 billion respectively.

The NNPC is currently being probed for alleged $179 million insurance policy, and alleged huge unsettled life insurance claims, poor handling of Group Life Insurance schemes, its effects on motivation and productivity of working-class citizens and non-payment/un-allowed deductions on entitlements of the surviving families.

For the $179 million premium allegedly paid by Nigerian National Petroleum Corporation (NNPC) and Joint Ventures (JVs), investigation showed that since 2013 to the current insurance year (2020/2021), the premium paid by NNPC has been reducing consistently notwithstanding that the assets value have been increasing through acquisition of new assets and new investments.

From a premium of $79.8 million and asset value of $50.3b in 2014/2015 insurance year, the premium has been on downward trend to $39.6 million with an increased asset value of $68.9 billion for 2020/2021 insurance year.

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