Why workers need annuity plan – AIICO

AIICO Insurance Plc has said annuity is one of the most important products clients can buy from insurance companies.

This is even as the company has reiterated its commitment to providing a robust annuity service that meets customers’ expectations as well as drives the growth of insurance in the country.

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An annuity is a series of equal payments made at equal intervals during a period of time. 

The managing director/CEO, AIICO Insurance Plc, Mr Babatunde Fajemirokun, said this at a training for insurance correspondents organised by the company.

Fajemirokun, who was represented at the occasion by the Head, Strategic Marketing and Communications, Mr Segun Olalandu, said AIICO Insurance is doing everything possible to deepen annuity business in order to take advantage of its inherent opportunities.

 The AIICO Insurance boss, who described annuity business as a game-changer for everybody, said the insurer is committed to a robust and effective annuity service.

He noted that a lot still needed to be done to deepen business in Nigeria adding, “We are not there yet, but step by step, we will get there.” 

Speaking on the theme of the training, ‘Understanding Annuity Business,’ the Senior Manager, Business Development, AIICO Insurance, Mr Victor Owotorose, stressed the importance and benefits of annuity to the clients and the growth of the insurance industry.

Annuities, he stressed, are insurance contracts that promise to pay you regular income immediately or in the future.

According to him, a deferred annuity has an accumulation phase followed by a disbursement (annuitisation) phase; while an immediate annuity converts a lump sum into cash flows from day one.

Owotorose also said annuity could be bought with either a lump sum or a series of payments contributed over time, adding that annuities come in three main varieties—fixed, variable and indexed—each with its own level of risk and payout potential.