Insurance commissioner inaugurates Actuarial Society Discount Rate C’ttee

The Commissioner for Insurance, Mr Sunday Thomas has inaugurated the Nigerian Actuarial Society Discount Rate Committee (NAS-DRC).

The committee is to aid the implementation of the International Financial Reporting Standard 17 (IFRS-17) Insurance Contracts.

Thomas said this in a statement on Friday in Lagos.

He stated that the standing committee was expected to support the setting up of a standardised basis of determining discount rate factors for use by the insurance industry and other stakeholders in the financial sector.

The commissioner said, setting a standard discount rate was necessary, particularly in the implementation of the IFRS-17.

“The membership of the NAS-DRC had been suitably drawn from representatives of NAS, National Insurance Commission (NAICOM) Actuarial representatives of Audit firms, as well as Resident Actuaries of Insurance Operators, with annuity business.

“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,” he said.

According to him, the role of actuaries in the implementation of IFRS -17 cannot be overemphasised.

Thomas said there was need for a credible, prudent, consistent and sustainable discount rate devoid of possible manipulation by different stakeholders, if the financial report is left to determine same for individual company’s use.

He listed the objectives of the NAS-DRC to include ; determining the risk-free yield curve for use by the insurance industry and providing commentary on any market movement that might impact on the determination of the risk-free yield curve.

“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.

“I am hopeful that the deliberations
and activities of the NAS-DRC will bring about the desirable impact for the Nigerian financial system.

“I thank all the nominated members for accepting to serve on this commendable task. The insurance industry acknowledge your individual and collective sacrifices,” the commissioner said.