Nigeria Statutory and Private Employee Benefits, 2023 Update
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Nigeria Statutory and Private Employee Benefits Report Overview
The Nigerian pension system has been facing much turbulence, regardless of the increase in the number of pensioners every year. The Nigerian pension system includes everyone from means-tested to private employees. Nigeria’s social security system is based on the principle of defined benefits (pay-as-you-go) and is generally managed by the state government. The social security system covers a limited number of benefits and provides them based on the insured’s contribution period. Nigeria also has an informal social security system to which people can contribute voluntarily.
The Nigeria employee benefits market research report provides in-depth industry analysis, information, and insights into employee benefits in Nigeria, including an overview of the state and compulsory benefits in Nigeria, detailed information about the private benefits in Nigeria, insights on various central institutions responsible for the administration of the different branches of social security and the regulatory framework of the employee benefits in Nigeria.
Key Regulations | Employees’ Compensation Act of 2010, The Pension Reform Act 2014, The National Health Insurance Act 2022, and The Insurance Act 2003 |
Key State and Compulsory Benefits | Retirement Benefits, Death in Service, Long-Term Disability Benefits, Medical Benefits, Workers’ Compensation Insurance, Maternity and Paternity Benefits, and Other Benefits |
Key Private Benefits | Retirement Benefits, Death Benefits, Medical Benefits, Disability Benefits, Accidental Death and Dismemberment Benefits, and Other Benefits |
Regulations Guiding Employee Benefits Market in Nigeria
Some of the key regulations guiding the employee benefits market in Nigeria are the Employees’ Compensation Act of 2010, The Pension Reform Act 2014, The National Health Insurance Act 2022, and The Insurance Act 2003 among others.
Nigeria Employee Benefits Market Segmentation by State and Compulsory Benefits
The key state and compulsory benefits offered by employers in Nigeria are retirement benefits, death in service, long-term disability benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.
Retirement Benefits: In Nigeria, eligible individuals receive a pension under the mandatory Contributory Pension Scheme (CPS) introduced by the Pension Reform Act 2014. All public and private sector employees and employers must contribute to the scheme, except for diplomats. The National Pension Commission (NPC) supervises and regulates the pension system. Pension schemes in the private sector existing prior to the introduction of the Contributory Pension Scheme (CPS) in June 2004 were allowed to continue as CPFAs. Companies with at least a total asset of NGN500 million ($1.2 million) are eligible to offer CPS to their employees.
Medical Benefits: Medical benefits in Nigeria are provided under the National Health Insurance Authority (NHIA). There are several healthcare programs under the NHIA, such as the Formal Sector Social Health Insurance Program (FSSHIP), Mobile Health, the Voluntary Contributions Social Health Insurance Program (VCSHIP), and the Public Primary Pupils Social Health Insurance Program (PPPSHIP).
Nigeria Employee Benefits Market Segmentation by Private Benefits
The key private benefits offered by the employers of Nigeria are retirement benefits, death benefits, medical benefits, disability benefits, accidental death and dismemberment benefits, and other benefits.
Retirement Benefits: In Nigeria, workers can opt to make additional voluntary contributions (AVCs) which are made over and above their mandatory contributions. Contributions are made to the individual’s (Retirement Savings Account) (RSA). Contributions to AVCs must be no more than 100% of the individual’s salary. AVC benefits may be accessed at any time before retirement.
Disability Benefits: Stand-alone long-term disability and short-term disability benefits are not prevalent in the country. Employers provide disability benefits under employers’ liability insurance with unlimited liability to complement the mandatory workers’ compensation insurance. Short-term and long-term disability is also provided as an additional benefit under group life insurance plans.
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Scope
This report provides a detailed analysis of employee benefits in Nigeria –
- It offers a detailed analysis of the key government-sponsored employee benefits, along with private benefits.
- It covers an exhaustive list of employee benefits, including retirement benefits, death in service, long-term disability benefits, medical benefits, workmen’s compensation insurance, maternity and paternity benefits, family benefits, unemployment benefits, Long-term care benefits, leaves and holidays, and private benefits.
- It highlights the economic and regulatory situations relating to employee benefits in Nigeria.
Key Highlights
• The Nigeria Social Insurance Trust Fund (NSITF), National Pension Commission (PenCom), National Health Insurance Authority (NHIA), and Federal Housing Authority (FHA) are responsible for the functioning of the overall social security system.
• A person’s national insurance contribution is determined based on their income.
• An insured person who is unemployed or unable to work and whose benefits have been exhausted is entitled to a credited contribution.
• In Nigeria, employers provide voluntary retirement benefits to their employees through defined contribution plans and gratuity schemes.
Reasons to Buy
- Make strategic decisions using in-depth information related to employee benefits in the country.
- Assess employee benefits of the market, including state and compulsory benefits and private benefits.
- Gain insights into the key employee benefit schemes offered by private employers in the country.
- Gain insights into key organizations governing the employee benefits market, and their impact on companies.
Table of Contents
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Frequently asked questions
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What are the key regulations guiding the employee benefits market in Nigeria?
The key regulations guiding the employee benefits market in Nigeria are Employees’ Compensation Act of 2010, The Pension Reform Act 2014, The National Health Insurance Act 2022, and The Insurance Act 2003.
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What are the key state and compulsory benefits in the Nigeria employee benefits market?
The key state and compulsory benefits in the Nigeria employee benefits market are retirement benefits, death in service, long-term disability benefits, medical benefits, workers’ compensation insurance, maternity and paternity benefits, and other benefits.
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What are the key private benefits in the Nigeria employee benefits market?
The key private benefits in the Nigeria employee benefits market are retirement benefits, death benefits, medical benefits, disability benefits, accidental death dismemberment benefits, and other benefits.
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