Nigeria at 66: Insurance Industry Focuses on Developing Institutional Strength

Nigeria's insurance industry is currently focusing on bolstering its institutional strength to bolster its contribution to the nation's economic growth. The sector has been actively implementing various reforms aimed at developing the necessary institutional strength required to support the economy. A significant milestone in this journey was the signing of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 by President Bola Ahmed Tinubu.

This landmark legislation replaced outdated insurance laws with a modern legal framework and adjusted capital requirements for various types of insurance operators, reinsurers, and composite firms.

In addition to these reforms, the National Insurance Commission (NAICOM) has been taking active steps to ensure the industry's growth. Following the recapitalisation exercise, NAICOM issued its first Insurtech licence, emphasising the importance of innovation and market integrity. The sector has also seen an enhanced focus on digitisation and compulsory insurance enforcement, such as third-party motor insurance, to improve consumer protection.

Moreover, NAICOM has been actively intervening in weak insurance firms to safeguard policyholders. This intervention began with African Alliance Insurance Plc in October 2024, which was saved through a 18-month turnaround process. The sector is also embracing regional integration through the ECOWAS Brown Card System, which expands participation in regional insurance schemes.

The industry has made notable progress, such as enforcing the no premium no cover law, reviewing motor insurance premiums, and developing a microinsurance platform to boost the sector's growth.