By Joy Baba-Yesufu
Nigeria’s insurance industry has entered a 12-month race to meet new minimum capital requirements following the enactment of the Nigerian Insurance Industry Reform Act (NIIRA) 2025.
A circular dated August 13, 2025, signed by Usman Jankara, Deputy Commissioner for Insurance (Technical) at the National Insurance Commission (NAICOM), directed all insurance and reinsurance firms to comply with the recapitalisation rules by July 30, 2026.
The recapitalisation exercise took effect on July 31, 2025, the date President Bola Tinubu assented to the NIIRA 2025, a landmark law that repeals outdated legislation, consolidates regulatory provisions, and introduces a modern legal framework for the sector.
The Act prescribes new Minimum Capital Requirements (MCR) of ₦10 billion for life insurers, ₦15 billion for non-life, ₦25 billion for composite insurers, and ₦35 billion for reinsurance firms, alongside a shift to a risk-based capital framework.
However, industry players say there is widespread uncertainty over the precise composition of the new MCR, describing provisions as “unclear” and “ambiguous.”
NAICOM said detailed guidelines covering acceptable forms of capital, capital verification procedures, qualifying assets, and computation templates will be issued “in due course.” All assets will be subject to verification, with non-standard checks billed to the concerned company.
Firms that meet the requirements within the deadline will be issued new licences. Those that fail face liquidation, merger, or other regulatory action.
The Commission pledged to work with regulators including the Securities and Exchange Commission (SEC), Corporate Affairs Commission (CAC), and Nigerian Stock Exchange (NSE) to explore incentives and concessions that could ease compliance costs.
