The National Insurance Commission (NAICOM) has issued a new directive outlining the minimum capital requirements (MCR) for insurance and reinsurance companies in Nigeria, as part of the implementation of the recently enacted Nigerian Insurance Industry Reform Act (NIIRA) 2025.
The move, aimed at enhancing the stability and financial health of the insurance sector, follows sweeping reforms introduced under the NIIRA to align Nigeria’s insurance industry with global standards.
According to the new framework:
- Non-life insurance firms must now maintain a minimum capital base of ₦15 billion
- Life insurance companies are expected to hold at least ₦10 billion
- Reinsurance companies face the highest requirement, with a new threshold of ₦35 billion
NAICOM stated that these measures are designed to foster stronger institutions, safeguard policyholders, and ensure the industry can meet future obligations.
Submission of Recapitalisation Plans Due by September 30
In a circular signed by Director of the Supervision Directorate Oluwatoyin Charles, NAICOM directed all licensed insurers to submit detailed recapitalisation plans no later than September 30, 2025.
Each submission must include:
- A board resolution affirming commitment to compliance
- Capital status based on 2024 audited financials and Q2 2025 returns
- Proof of statutory deposits with the Central Bank of Nigeria (CBN)
- A comprehensive capital-raising roadmap, including sources and timelines
Firms intending to raise funds through the capital market must notify the Commission under a file-and-use system. Insurers considering mergers or acquisitions must submit formal proposals that comply with NAICOM’s guidelines.
From now until full compliance, insurance companies must file monthly recapitalisation status reports no later than 10 working days after month-end. These reports must detail:
- Current capital status based on NAICOM’s MCR template
- Progress milestones
- Asset sales, proceeds, and how they are applied
Companies that meet the new MCR early must still continue monthly reporting until a licence is issued or otherwise advised by the Commission.
Capital Verification Timeline Set
The capital verification exercise will begin on November 1, 2025, and conclude by June 30, 2026. During this period, companies must submit:
- Evidence of ownership and valuation of admissible assets
- Actuarial reports to support capital adequacy
- Final statutory deposit evidence with the CBN by May 30, 2026
The final compliance deadline for all insurers and reinsurers is set for July 30, 2026.
Meanwhile, the Securities and Exchange Commission (SEC) has set up a dedicated approval desk to assist insurers seeking to raise funds through public offerings. The SEC promises to process complete submissions within 14 days, speeding up recapitalisation efforts across the sector.
NAICOM warned that non-compliance will not be tolerated, stressing that enforcement actions will be taken against defaulters as provided under the NIIRA 2025.
About the Author
