Insurers Race To Meet Recapitalisation Deadline With N8.2bn Rights Issues

The race to meet Nigeria’s insurance recapitalisation deadline has intensified as two insurance firms moved to raise a combined N8.222 billion through rights issues on the Nigerian Exchange (NGX), underscoring growing efforts by operators to comply with new capital requirements under the Nigerian Insurance Industry Reform Act (NIIRA) 2025.

The recapitalisation exercise, which carries a July 30, 2026 deadline, requires insurance companies to significantly strengthen their capital base to improve underwriting capacity, enhance balance sheet resilience and restore confidence in the sector.

As part of the exercise, Sovereign Trust Insurance Plc is seeking to raise N5.022 billion through the issuance of 2.511 billion ordinary shares of 50 kobo each at N2.00 per share.

The offer, which opened on May 4, 2026, and is scheduled to close on June 10, 2026, is based on three new ordinary shares for every existing 17 ordinary shares held by shareholders as of March 17, 2026.

Similarly, Universal Insurance Plc has launched a N3.2 billion rights issue through the issuance of 2.667 billion ordinary shares of 50 kobo each at N1.20 per share.

The company’s offer opened on May 13, 2026, and will close on June 10, 2026. The shares are being offered on the basis of one new ordinary share for every six ordinary shares held as of March 30, 2026.

Analysts said the capital-raising initiatives reflect both the urgency of regulatory compliance and renewed investor confidence in the insurance sector’s long-term growth prospects.

Speaking on the development, the managing director and chief executive officer of Sovereign Trust Insurance Plc, Lucas Durojaiye, described the capital raise as central to the company’s expansion strategy.

According to him, achieving the company’s ambition of becoming one of the top five players in Nigeria’s insurance industry requires a stronger capital base capable of supporting future growth plans.

“In achieving our aspiration of becoming a top-five player in the Nigerian insurance industry, we have identified that a very robust capital base is critical to the success of our set agenda,” he said.

Durojaiye urged shareholders to fully subscribe to the rights issue to enable the company strengthen its operations and create more value for investors.

He added that the insurer is positioning itself to become one of the most preferred insurance companies in Nigeria and an employer of choice in the years ahead.

Also commenting, chairman of Universal Insurance Plc, Jasper Nduagwuike, said the company remained confident about its future despite economic and industry headwinds.

He noted that Universal Insurance had maintained steady growth over the past five years and described the rights issue as a strategic investment opportunity for shareholders.

“We have a very solid foundation. For a company that has spent over 60 years in the industry, survived economic cycles and industry challenges, and is still standing strong, it speaks volumes about our resilience,” he said.

Industry stakeholders believe the recapitalisation programme could reshape Nigeria’s insurance landscape by creating stronger and more competitive operators capable of underwriting bigger risks and supporting economic growth.