Mr. Olusegun Omosehin, Commissioner for Insurance/CEO, National Insurance Commission (NAICOM), has attributed the success of the recent recapitalisation exercise in the Nigerian insurance sector to the huge appetite for insurance investment in the country.
Evaluating the process and conclusion of the recent recapitalisation programme at a media roundtable in Lagos, Omosehin stated that 48 insurance companies and two reinsurers scaled the Minimum Capital Requirement (MCR) hurdle while six insurance firms had their operating licences revoked for failing to meet the MCR deadline of Friday, July 2026 as stipulated in the Nigeria Insurance Industry Reform Act (NIIRA) of 2025.s
Omosehin also added that operators generated over N1.079 trillion in the course of raising capital to achieve the MCR target.
“Across the global insurance sector, regulators periodically review capitalisation to ensure that operators possess the requisite capital base to meet their contractual obligations to policyholders. And NIIRA 2025 also gave room for strategic transformation of the insurance market in Nigeria, with adequate capital by operators as one of the key parameters.”
The NAICOM boss said the recapitalisation exercise embarked upon by the Commission was a major provision in the NIIRA 2025 legislation, which has strengthened the regulatory authority of the Commission.
He listed four major objectives of the recapitalisation exercise as:
- Strengthen the financial capacity of the insurance market in Nigeria
- Ensure adequate consumer protection of policyholders promptly and consistently
- Enhance stability of the insurance industry against economic shock and uncertainty
- Support sustainable growth of the Nigerian economy
The Nigerian regulator said the exercise generated positive outcomes in terms of enhanced interest in the insurance sector in the country by investors, improved resilience of the industry and has given policyholders a greater sense of protection in the event of unforeseen circumstances.
“The success recorded has demonstrated the huge appetite for insurance investment in Nigeria, signals what the future holds for the market, gives operators the latitude to keep substantial level of premiums within the country and further strengthens the foundation to ensure rapid growth of the insurance industry in the country.”
Omosehin made it clear that the exercise was not intended to eliminate any operator or operators as the process was guided strictly by law and long-term interest of operators and policyholders. He urged insurers that failed to meet the MCR deadline to explore the option of Mergers & Acquisition (M&A) in order to remain in business.
He said the Commission also expects the following benefits from the exercise:
- Deepen insurance penetration across the country
- Expand financial inclusion
- Drive digital innovation-growth of Insurtech
- Prioritise prompt claims settlement by insurers
- Lead to the emergence of Risk-Based Supervision (RBS)
“Going forward, we are open to new licences provided the prospective entrants into the Nigerian insurance sector have value on the table. We expect the newly recapitalised entities to attract talent from other sectors to run profitably. The recapitalisation exercise was a great progress for the insurance market in Nigeria. We are making progress.”
NB: First published in Africa Ahead.
