Connect with us
Advertise With Us


2018 Budget: FG Plans Group Life Insurance For 89,000 Workers



The federal government has made budgetary provision to the tune of N5.4 billion as 2018 Group Life Insurance cover for its 89,000 workforce, in the 2018 national budget currently before the National Assembly (NASS), LEADERSHIP can exclusively reveal.

To this end, all government workers who die or suffer accident in active service will have access to group life insurance claims as soon as it is activated in the second quarter of the year.

Group life insurance is a cover undertaken by the federal government through the Office of Head of Civil Service of the Federation on behalf of its federal civil servants for their protection against unforeseen circumstances, such as death and disabilities associated with industrial hazards while in active service.

However, the workers may have to wait till around August, 2018 after the legislators must have passed the budget and necessary appropriation made to become functional.

However, LEADERSHIP investigation revealed that selection process for the underwriters and brokers interested in writing the group cover would begin in the coming weeks, while about 20 to 21  insurance companies and about 100 insurance brokers would be finally selected to underwrite the 2018 group life cover of its civil servants spread across the federation.

Section 4 (5) of the Pension Reform Act(PRA) 2014 states that “every employer(FG) shall maintain a group life insurance policy in favour of each employee for a minimum of three times the annual total emolument of the employee and premium shall be paid not later than the date of commencement.”

Meanwhile, investigation revealed that the federal government is still owing about N2.1 billion amounting to 38 per cent as outstanding premium for 2017 Group Life Cover of its workers across the country.

A source however disclosed that there are skeletal arrangement ongoing to pay the 2017 outstanding premium balance to the 20 insurance companies concerned.

LEADERSHIP had  reported that the federal government had earlier paid 62 per cent of the 2017 group life premium of its workers amounting to N3.3 billion from the total premium of N5.4 billion, leaving an outstanding of N2.1 billion.

Confirming the development, managing director, Lectern Insurance Brokers, Mr. Tunde Oguntade, said the federal government has paid about 62 per cent of the 2017 premium, but yet to pay the remaining 38 per cent, adding that the policy life span is between December 2016 to November 2017.

He stressed that even though the federal government arranged this insurance contract through the Office of Head of Civil Service of the Federation in August 2016, the government only paid 42 per cent of the required premium in December 2016, paid about 20 per cent in August, 2017 saying, because of the ‘No Premium, No Cover’ provision, insurers only activated the cover when premium was paid in December 2016.

“62 per cent of the premium has been paid, but the remaining 38 per cent has not been paid. The policy was supposed to start in August, but the premium was not paid until December, 2016 and insurance operators implemented the no premium no cover, so, it starts counting from December,” he pointed out.

To this end, civil servants were not insured from August to November 2016 due to non-payment of the required premium.

The Permanent Secretary (Common Services Office) in the Office of Head of Civil Service of the Federation (OHSF), Mr. Yemi Adelakun, had, last year, said: “It (premium) is usually N5.4 billion annually for civil servants. That’s the figure and that had been recurring for the last three or four years.”

“For this current one (2017), I think we shortlisted 21 insurance companies and Bureau of Public Procurement (BPP) gave us certificate of no objection for 20. And we can only work with those approved by the BPP and that approval has been confirmed by Mr. President,” he added.



%d bloggers like this: