The National Insurance Commission (NAICOM) has emphasized that the full implementation of the Nigerian Insurance Industry Recapitalisation and Reform Act (NIIRA Act) is critical for strengthening the insurance sector and aligning it with global standards.
With just 11 months left before the recapitalisation deadline mandated by the NIIRA Act, stakeholders in the industry have been urged to intensify preparations, as NAICOM finalises key guidelines expected to reshape the future of insurance and reinsurance companies in Nigeria.
The development was disclosed after the monthly meeting of the Insurers Committee, held in Lagos on Thursday, where the Commissioner for Insurance, Mr. Olusegun Omosehin, addressed industry leaders on the urgent steps needed to meet regulatory expectations.
Speaking after the closed-door session, Chairman of the Publicity Sub-Committee of the Insurers Committee, Mrs. Ebelechukwu Nwachukwu, said recapitalisation remained the most immediate action under the NIIRA Act.
According to her, NAICOM is working on the finalisation of guidelines that will determine the minimum capital requirements for operators.
“The Commissioner reminded us that NIIRA is a clear signal to achieving the Federal Government’s target of a $1 trillion economy.
Its success depends largely on the proper implementation of the Act, which realigns Nigeria’s insurance industry with international benchmarks,” she said.
Nwachukwu also noted that the regulator had earlier released a draft of the minimum capital requirement guideline for industry input.
Stakeholders have since submitted their comments, which NAICOM is reviewing to ensure that the final framework reflects a balanced approach that fosters both stability and growth.
Industry experts argue that recapitalisation will position Nigerian insurers to underwrite bigger risks, support infrastructure development, and provide long-term capital needed for economic expansion.
“The recapitalisation exercise is not just about compliance. It is about unlocking the true potential of insurance as a driver of inclusive economic growth.
A stronger capital base means companies can take on more complex risks, attract foreign investors, and protect Nigerian businesses against unforeseen shocks,” said an industry analyst.
The Commissioner, Omosehin, also highlighted that the NIIRA Act incorporates compulsory insurance provisions, which, if well enforced, could significantly expand insurance penetration in Nigeria.
Currently, insurance penetration in the country remains below 1% of GDP, far behind peers such as South Africa and Kenya.
Another central theme of the discussions was the integration of technology into the insurance ecosystem.
NAICOM stressed that digitalisation would be key in driving compliance, improving claims processing, and building consumer trust.
Omosehin further disclosed that NAICOM is exploring collaborations with other government agencies to ensure seamless enforcement of the NIIRA Act.
Such partnerships are expected to enhance compliance monitoring, data exchange, and regulatory oversight.
While operators have welcomed reforms under the NIIRA Act, there are lingering concerns about the financial burden recapitalisation may pose, especially for smaller firms.
Some stakeholders argue that without access to cheap credit, mergers and acquisitions may become inevitable.
To address this, NAICOM is expected to provide a clear roadmap that balances regulatory demands with industry realities.
Analysts believe this could include phased recapitalisation windows, incentives for consolidation, and support for companies that demonstrate sustainable business models.
The implementation of the NIIRA Act is expected to significantly improve investor confidence in the Nigerian insurance industry, which has often been criticised for weak compliance, poor claims settlement, and limited product innovation.
If successfully executed, the Act could serve as a catalyst for foreign direct investment, strengthen the financial services ecosystem, and contribute meaningfully to the Federal Government’s economic diversification agenda.
Mrs. Nwachukwu added that insurers are fully aware of the responsibility ahead. “We are committed to ensuring that the industry emerges stronger.
The recapitalisation process, though challenging, provides an opportunity to rebuild trust, deepen penetration, and showcase insurance as a key player in national development,” she said.
As the 11-month countdown continues, all eyes are on NAICOM to release the final recapitalisation guidelines that will determine the pace and direction of the industry’s transformation.
Stakeholders believe that the coming months will be decisive in shaping the future of insurance in Nigeria, ensuring it plays a more impactful role in protecting businesses, boosting investor confidence, and supporting economic growth.