The National Insurance Commission (NAICOM), in its recently released Insurtech Guidelines, barred Insurtech firms from ineligible insurance businesses, such as oil and Gas Insurance, Marine and Aviation Insurance, Retirement Life Assurance, and insuring Government Assets and Liabilities for Ministries, Departments, and Agencies (MDAs).
The operational guidelines, issued by the regulator last Wednesday, took effect on Friday, August 1, 2025. They are expected to provide a clear and unified regulatory framework for the licensing, operations, and supervision of Insurtech firms in the country.
Insurtech is a combination of the words ‘insurance’ and ‘technology. ‘ Hence, It refers to an institution that uses technological innovations to provide insurance services efficiently and effectively.
According to the regulator, “an insurtech shall not engage in non-permissible activities, such as unlicensed insurance operations and launching products or using dynamic pricing without actuarial support or prior approval from the commission and complete reliance on Artificial Intelligence (AI) systems to decline claims without human intervention, is not permissible for Insurtech.”
Meanwhile, an insurtech is mandated to display the licence obtained from the commission and details of its validity on its website and other electronic platforms used by the insurtech, stating clearly that insurance is the subject matter of solicitation or its operation.
“An insurtech shall maintain at all times the minimum capital requirement and Risk Based Capital as may be prescribed by the Commission from time to time.
iv. An insurtech shall at no point in time operate beyond the purview of the licence issued to it by the Commission. An insurtech shall always allow its clients to choose from different Companies’ products that meet their needs (where applicable),” it added.
Believing that the guidelines will foster innovation that can lead to developing new and innovative insurance products and services, it added that this will ensure consumer protection and improve consumer experience, prioritising consumer interests and providing better services.
“It is expected to provide clarity on regulatory requirements, reduce uncertainty and ambiguity, help build trust and confidence in the Insurtech sector, drive growth and adoption, and advance digital transformation within the Nigerian insurance sector, “ it pointed out.
