S.L.A.C. urged to compete with commercial banks
The Deputy Chair for the Finance and Expenditure Committee, Faumuina Tiatia Liuga, put forward several recommendations when the Samoa Life Assurance Corporation’s Annual Report was discussed in Parliament.
That the Samoa Life Assurance Corporation maintain its new policy holders at no less than 10% annually and that the Corporation should develop guidelines to encourage policy holders at not less than 10% annually.
He appealed to members of Parliament to approve the report with recommendations on the Annual Report of the Samoa Life Assurance Corporation (SLAC).
He also noted the need for the Corporation to develop guidelines to encourage policy holders not to withdraw, but to retain their policies till it matures.
Minister of Finance, Sili Epa pointed out the Government has set a target of 15- 20% increase in annual premiums per annum in Samoa Life Assurance Company’s corporate plan 2017-2020 and the government noted that the S.L.A.C. was determined to meet the target set.
Regarding the Corporation reviewing its policies with regards to Superannuation provisions to be in line with the Cabinet Directive, the Minister referred to the Cabinet directive.
The Superannuation of staff members Super Plan had been discontinued; however, the Superannuation plans are provided by the S.L.A.C. to the general public.
He also noted that S.L.A.C. intends to review its Superannuation policies in the future to ensure effective services are offered to its clients.
The other recommendation was the provision of Contingency Reserve Fund to be reviewed to ensure efficient funds are available to cater for policy holders claims in the event of an emergency. The Minister explained the Mortality and Contingency Reserve Fund being set aside in the Financial Statements amounts to $1.1million by the Corporation with the Actuary’s support.
“The S.L.A.C. will consider reviewing the Mortality and Contingency Reserve Fund to cover policy claims in the event of Natural Disasters.”
Other recommendations by the Committee were for the Corporation to utilize and compete with Commercial Banks in terms of loan lending interest rates. The Committee believes that competing with Commercial Banks will provide better interest rates than what is being offered to date.
At the moment, the Corporation is offering 12% interest on loans on policies and 8% interest on mortgage loans.
The Minister explained the Government believes the interest rates that are currently operational are sufficient compared to other financial institutions.
“The S.L.A.C. assured us that they will continue to review their interest rates from time to time to assist with their policyholders.”