10 Insurers Face Licence Withdrawal As Recapitalisation Deadline Nears

With barely four days to the July 31, 2026 recapitalisation deadline, Nigerian insurance companies have raised over N300 billion in fresh capital as investors race to strengthen their balance sheets.

However, industry sources said at least 10 underwriters risk having their licences withdrawn if they fail to meet the National Insurance Commission (NAICOM)’s new minimum capital requirements.

The new minimum capital thresholds are: Life insurance companies, N10 billion;

Non-life (general) insurance companies, N15 billion; Composite insurers, N25 billion and  Reinsurance companies, N35 billion.

The ten insurers are said to be having problems meeting the requirements.

However, several insurers have announced successful capital raises in recent weeks. Lasaco Assurance raised about N25 billion, while Sovereign Trust Insurance (STI) Plc secured shareholders’ approval to raise N20 billion. SUNU Assurances also raised N9 billion to meet the new minimum capital requirement for non-life insurers.

Others include Linkage Assurance, which raised N16 billion through a rights issue; Guinea Insurance, N15 billion; Veritas Kapital Assurance, N15 billion through a private placement; Regency Alliance, N15 billion; and International Energy Insurance (IEI), N17.5 billion.

The commissioner for insurance and chief executive officer of NAICOM, Olusegun Omosehin, said the commission’s focus is to build a stronger, more credible insurance market capable of protecting policyholders and attracting long-term investment.

“The recapitalisation and market conduct reforms are designed to ensure that insurance companies are financially sound, well governed and capable of meeting their obligations to policyholders. This will ultimately strengthen confidence in the industry,” Omosehin said.

On his part, the president of the Chartered Insurance Institute of Nigeria (CIIN), Akinjide Orimolade, noted that many underwriters already had investors backing them and expressed confidence that most would meet the new capital threshold.

Orimolade, who is also the MD/CEO of Stanbic IBTC Insurance, said the exercise would make Nigerian insurers more globally competitive, enable them to retain high-value risks locally, and enhance innovation in products and service delivery.

Similarly, the immediate past chairman of the Nigeria Insurers Association (NIA), Mr Kunle Ahmed, also expressed confidence that most member companies would meet the requirement.

Ahmed, who is the MD/CEO of AXA Mansard Insurance Plc, stated that operators were not afraid of recapitalisation because it would ultimately leave the industry stronger and better positioned for growth.

Analysts say the recapitalisation would trigger mergers, acquisitions, strategic alliances and foreign capital inflows, as smaller firms unable to meet the new thresholds seek consolidation.

The managing director of Arthur Stevens Asset Management, Okechukwu Okeahialam, described the exercise as a structural reset for the industry.

“By the end of 2026, the industry may emerge leaner but considerably stronger, with operators possessing greater financial capacity to absorb shocks and support high-value sectors of the economy,” he said.

Speaking in the same vein, the Pan-African Manufacturers Association (PAMA) stated that Nigerian manufacturers could benefit from improved access to insurance cover and lower costs as the federal government implements enhanced capital requirements under the Nigeria Insurance Industry Reform Act (NIIRA) 2025.

In its monthly manufacturing review for June 2026, the association said the reform is designed to strengthen the financial capacity of insurance companies, enabling them to retain larger and more complex industrial risks that previously depended heavily on foreign reinsurance.

PAMA further said the implications for manufacturers extend beyond insurance premiums.

“Better-capitalised insurers will be able to retain a larger share of industrial risks locally, develop more specialised products, and provide stronger support for businesses investing in new production facilities, industrial parks and export-oriented operations,” it said.

The association added that the reform is also expected to improve access to project finance, noting that lenders typically require comprehensive insurance cover before committing funds to major manufacturing investments. A stronger local insurance market, it said, could make that process faster and more affordable.