NAICOM: 50 Insurers Raise N1.079trn Capital In Recapitalisation Exercise

The Commissioner for Insurance and chief executive officer of the National Insurance Commission (NAICOM), Olusegun Ayo Omosehin, has disclosed that 48 insurers and two reinsurers raised a total of N1.079 trillion in the concluded recapitalisation exercise.

He stated this on Thursday at an interactive session with insurance journalists in Lagos.

The commissioner explained that capital verification followed four levels, self-assessment by operators, NAICOM review, independent verification by the Big Four audit firms, and final approval by the NAICOM Board.

He said any capital raised was required to be domiciled in an escrow account with the Central Bank of Nigeria to allow for review of source of funds and Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT) compliance.

At the end of the exercise, 48 insurers and two reinsurers were relicensed. Six licenses were withdrawn: Nicon Insurance, Nigeria Reinsurance Corporation, Goldlink Insurance, Staco Insurance, Royal Exchange Prudential Insurance, and Universal Insurance.

The Nigerian Agricultural Insurance Corporation (NAIC) also failed to meet requirements for general insurance. Their general business licenses were withdrawn, but they will continue to underwrite agricultural insurance under their original mandate.

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 N15 billion for non-life insurance, N10 billion for life assurance and N35 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.

Omosehin said recapitalisation was only the foundation, saying that the Commission has appointed EY as actuaries to develop a Risk-Based Capital framework that will be released before October 1, 2026 for industry comments.

He dismissed reports of “N30 billion” or “N100 billion” recapitalisation fraud as baseless, saying the objective was never to eliminate operators but to strengthen the industry and create room for mergers.

“Ultimately, the greatest beneficiary is the Nigerian policyholder, whose protection and confidence remain at the heart of our regulatory mandate,”Omosehin said.