IFRS 17 Implementation: NAICOM Inaugurates Committee To Set Standardized Discount Rate For Insurance Contract
Mr Olorundare Sunday Thomas, CEO, NAICOM
The Commissioners for Insurance and Chief Executive Officer of the National Insurance Commission (NAICOM) and the Commissioner for Insurance, Mr Olorundare Sunday Thomas has inaugurated the Nigerian Actuarial Society Discount Rate Committee (NAS-DRC) to support the setting of a standardized basis of determining discount rate factors for use by the insurance industry and other stakeholders in the financial services sector, particularly in the implementation of the International Financial Reporting Standard 17 (IFRS 17), Insurance Contracts.
Thomas speaking while inaugurating the Committee in Abuja recently, said the membership of the NAS-DRC has been suitably drawn from representatives of NAS, NAICOM, Actuarial representatives of Audit Firms, as well as Resident Actuaries ofInsurance Operators (with annuity business).
He said the President of NAS and a representative of NAICOM (not below the rank of a Director) will serve as Chairman and Co-Chairman respectively, while the NAS shall provide the Secretariat.
NAICOM boss noted that “It is apparent the role of Actuaries in the implementation of IFRS 17 cannot be over emphasised, likewise the need for credible, prudent, consistent and sustainable discount rate devoid of possible manipulation by different stakeholders if left to determine same for individual company’s use.”
The objectives of the NAS-DRC, according to NAICOM boss, includes :To determine the risk-free yield curve for use by the insurance industry; and to provide commentary on any market movement that might impact on the determination of the risk-free yield curve.
After highlighting the objectives of the committee, Thomas expressed the hope that the deliberations and activities of the NAS-DRC will bring about the desirable impact for the Nigerian financial system.
While commending the nominated members for accepting to serve, Thomas told them that the insurance industry acknowledge their individual and collective sacrifices.
“It is thus my sincere expectation that the inauguration of the NAS-DRC will no doubt enhance accountability, prudence and comparability in financial reporting and thereby support the stability in the Nigerian financial system. Note also that the terms of reference remain as earlier circulated to
members,” NAICOM boss added.
