NICON, Nigeria Re fighting a lost battle against NAICOM, source says

NICON Insurance Limited and Nigeria Reinsurance Corporation are engaged in a losing battle against the National Insurance Commission (NAICOM) over the recent insurance sector recapitalisation exercise, according to a source at the regulator. The two companies, associated with businessman and politician Jimoh Ibrahim, contested the recapitalisation process in court after being omitted from NAICOM’s list of 43 compliant companies.

Consequently, they have had their operating licences revoked. A NAICOM insider, speaking anonymously due to the ongoing legal proceedings, stated that Ibrahim's opposition to the increased minimum capital requirement for reinsurance companies during the Senate deliberations in December 2024 was a contributing factor. Ibrahim argued that the proposed raise from N20 billion to N45 billion was excessive and could lead to the closure of some reinsurance companies in Nigeria and intensify reliance on foreign reinsurers.

The Senate's Banking, Insurance, and Financial Institutions Committee Chairman, Senator Mukhail Abiru, defended the proposed increase, stating that it was part of a risk-based framework and had already been adjusted to N35 billion after discussions and public hearings. Despite injecting N20 billion into NICON Insurance and N30 billion into Nigeria Re, the companies claim they met the July 31, 2026 recapitalisation deadline, surpassing the adjusted requirements of N16 billion and N28 billion, respectively.

However, NAICOM maintains that their interpretation of the requirements was incorrect, as they only fulfilled two out of the five necessary statutory requirements and the regulator's Minimum Capital Requirement Guidelines. NAICOM recently concluded the 12-month recapitalisation exercise, confirming 43 insurance and reinsurance companies as compliant, and appointed Dr Muiz Banire (SAN) as Receiver and Provisional Liquidator to oversee the dissolution of Nigeria Re's operations.