Insurance Recapitalisation Raises Industry Capital to ₦1.079trn — CFI
The National Insurance Commission (NAICOM) has disclosed that Nigeria’s recently concluded insurance industry recapitalisation exercise has generated a total capital of ₦1.079 trillion, marking a major milestone in efforts to strengthen the financial capacity and resilience of the sector.
The Commissioner for Insurance and Chief Executive Officer of NAICOM, Mr Olusegun Ayo Omosehin, disclosed this on Thursday at an interactive session with insurance journalists in Lagos.
Omosehin said the capital raised through the exercise represented a significant achievement in the Commission’s drive to reposition the industry, strengthen the capacity of operators and enhance the sector’s contribution to the Nigerian economy.
According to him, the stronger capital base would enable insurance companies to underwrite larger and more complex risks, improve their capacity to meet policyholder obligations and retain more risks within Nigeria.
He added that the recapitalisation was also expected to enhance the industry’s ability to support major investments and economic activities while improving confidence in insurance as a critical component of the financial system.
The Commissioner commended insurance operators and other stakeholders for their cooperation and commitment throughout the recapitalisation process, which culminated in the review of operators’ capital positions and regulatory compliance.
The exercise was initiated by NAICOM as part of a broader effort to strengthen the financial foundation of the insurance industry and address the sector’s limited capacity to retain large risks.
Under NAICOM’s regulatory framework, insurers are required to maintain prescribed minimum capital levels, with the current framework providing for minimum capital of ₦15 billion for non-life insurance, ₦10 billion for life assurance and ₦35 billion for reinsurance, or such higher risk-based capital as may be determined by the Commission.
The Commission’s regulatory framework also adopts a risk-based approach to determining capital adequacy, taking into consideration insurance, market, credit and operational risks.
NAICOM subsequently reviewed applications and supporting documentation submitted by operators and issued regulatory approvals to companies that satisfied the applicable requirements.
The completion of the recapitalisation exercise is expected to reshape competition within the industry as operators with stronger balance sheets seek to expand their underwriting capacity, improve their market position and compete for larger corporate and infrastructure risks.
For policyholders, however, the bigger question will be whether the stronger capital base translates into improved service delivery, faster settlement of legitimate claims and greater confidence in insurance products.
The fresh capital is also expected to support greater retention of risks within the domestic market, reducing dependence on foreign capacity for risks that Nigerian insurers are increasingly able to underwrite.
The development comes as NAICOM continues to strengthen its regulatory and digital oversight of the industry. The Commission operates an online regulatory filing system through which regulated entities submit mandatory returns, while its public insurance portal enables consumers to verify the validity of insurance policies and allows regulators and other authorised stakeholders to monitor insurance transactions.
Reacting to the development, insurance journalists congratulated NAICOM on the successful conclusion of the recapitalisation programme and described it as an important turning point for the industry.
They commended the Commission for providing regulatory direction and maintaining engagement with operators and other stakeholders throughout the exercise.
With the recapitalisation now concluded and ₦1.079 trillion in capital reported, attention is expected to shift from capital raising to capital deployment — particularly how operators utilise their stronger balance sheets to expand underwriting, invest in technology and distribution, settle claims promptly and deepen insurance penetration across Nigeria.
The ultimate test of the exercise, therefore, will be whether the enlarged capital base translates into a more resilient, competitive and customer-focused insurance industry capable of supporting Nigeria’s growing economic and infrastructure needs.
