The National Pension Commission (PenCom) and the National Insurance Commission (NAICOM) have introduced tough new measures to force employers into complying with pension and insurance laws.
Both regulators now require insurance companies to only work with employers that comply with pension deductions and employee life insurance contributions.
In a joint circular issued on Wednesday, PenCom and NAICOM said every Licensed Insurance Company (LIC) must obtain:
- A valid Pension Clearance Certificate (PCC)
- A Group Life Assurance (GLA) Certificate that meets NIIRA 2025 standards
Without these documents, insurers cannot carry out business or investment activities.
The circular, signed by PenCom’s Director of Surveillance, Abdulrahaman Muhammad Saleem, and NAICOM’s Director of Legal, Enforcement and Market Development, Dr. Talmiz Usman, aims to boost compliance with the Pension Reform Act (PRA) 2014 and the Nigerian Insurance Industry Reform Act (NIIRA) 2025.
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The PRA requires all employers to:
- Remit pension contributions no later than seven days after paying salaries
- Provide compulsory life insurance cover for employees
However, many employers still ignore these laws including some in the financial sector.
PenCom said it has already appointed Recovery Agents to audit defaulters and recover unpaid pension funds, but many firms continue to violate the rules.
No Contract Without Compliance
Under the new policy:
- Insurance firms must only do business with compliant employers
- Vendors, contractors, banks, and partners must also present valid PCCs and GLA certificates
- Every investment including commercial papers, bonds, and deposits — must meet compliance checks
- Companies must sign compliance attestation forms before deals go through
This creates a full chain-compliance system, ensuring every company connected to the insurance industry follows the law.
Internal Reforms and Transition Period
Insurance firms must revise their:
- Vendor screening processes
- Procurement policies
- Governance and risk-management systems
The rule also applies to parent companies, subsidiaries, and institutional shareholders.
To ease implementation, PenCom and NAICOM granted a six-month transition period for insurers to adjust systems and notify business partners.
READ ALSO: PenCom Launches Pension Revolution 2.0 to Raise Retirees’ Pay, Expand Coverage
The regulators said the move protects employees’ pension rights and prevents abuse in the system.
They also stressed that strict enforcement will improve trust in the contributory pension scheme and strengthen Nigeria’s insurance market.
Esther Ososanya is an investigative journalist with Pinnacle Daily, reporting across health, business, environment, metro, Fct and crime. Known for her bold, empathetic storytelling, she uncovers hidden truths, challenges broken systems, and gives voice to overlooked Nigerians. Her work drives national conversations and demands accountability one powerful story at a time.
