NAICOM issues guidelines on insurance policyholders’ protection fund (IPPF)
The National Insurance Commission (NAICOM) has directed all insurers and reinsurers in Nigeria to strictly comply with newly issued Guidelines for the Collection, Management, and Administration of the Insurance Policyholders’ Protection Fund (IPPF).
The Commission warned that assessment returns for 2025 must be submitted not later than 31st May 2026.
The directive was contained in a circular signed by its Deputy Director of Special Risk and Security Analysis, John Falade, on behalf of the the Commissioner for Insurance, Olusegun Ayo Omosehin.
The Fund, established under Section 212 of the Nigerian Insurance Industry Reform Act 2025 (NIIRA 2025), is designed as a statutory safety net to protect policyholders against the distress or insolvency of licensed insurers and reinsurers.
Under the guidelines, insurers and reinsurers are required to contribute 0.25 per cent of their net premium income annually to the Fund.
An additional 0.25 per cent of the balance in the Security and Insurance Development Fund as of 31st December of the preceding year will also be paid into the Fund.
According to the circular, the Fund will be used to settle unpaid claims arising from insolvency or licence cancellation and to support resolution of distressed insurance firms.
The Commission emphasised that the objectives of the guidelines include: Safeguarding policyholders and beneficiaries, ensuring timely and accurate collection of contributions, establishing sound management and investment practices, providing procedures for disbursement and recovery of loans and promoting transparency, accountability, and governance in fund administration.
The guidelines apply to all insurance and reinsurance companies in Nigeria, as well as the IPPF Committee and Fund Manager appointed by NAICOM. Contributions commenced on 31 July 2025, the date NIIRA 2025 was signed into law.
The Commissioner for Insurance assured stakeholders of NAICOM’s commitment to regulatory clarity and effective oversight.
