Six insurers miss NAICOM deadline as N720bn recapitalisation

Six Nigerian insurance companies have failed to secure confirmation of compliance with the National Insurance Commission’s (NAICOM) new minimum capital requirements by the July 31, 2026 deadline, leaving them facing regulatory uncertainty even as N720 billion was raised across the industry and 50 operators were cleared under the recapitalisation exercise.

NAICOM has confirmed 48 insurance companies and two reinsurance companies as compliant with the new minimum capital requirements prescribed under the Nigerian Insurance Industry Reform Act (NIIRA) 2025, effectively bringing the sector-wide recapitalisation exercise to an end.

The six firms not on the verified list are Goldlink Insurance, Staco Insurance, NICON Insurance, Nigeria Reinsurance Corporation, Royal Exchange Prudential Life and Universal Insurance.

The outcome marks a significant restructuring of Nigeria’s insurance industry following NAICOM’s increase in minimum capital thresholds to N10 billion for life insurers, N15 billion for non-life insurers, N25 billion for composite insurers and N35 billion for reinsurers.

The affected companies, however, do not face identical circumstances, with some pursuing fresh capital injections, while others are challenging aspects of NAICOM’s recapitalisation process.

Goldlink Insurance enters the post-deadline period from a particularly difficult position. The insurer was delisted from the Nigerian Exchange in April 2025 after prolonged compliance and reporting problems. Its failure to appear on NAICOM’s verified list now adds another layer of uncertainty to its future.

Staco Insurance is also seeking to raise the funds required to meet the new capital threshold. The company has obtained approval for its 2024 financial statements and is working through the regulatory process required for additional capital injection.

NICON Insurance and Nigeria Reinsurance Corporation have taken a different route, challenging elements of the recapitalisation process.

NICON is disputing NAICOM’s assessment of a N305 million capital injection fee and other charges, as well as the requirement for operators to transfer their entire recapitalisation funds into an escrow account with the Central Bank of Nigeria.

Nigeria Re is contesting similar requirements and a N375 million assessment. The company maintains that it injected N30 billion, above its adjusted capital requirement of N28 billion, before the deadline.

The Federal Ministry of Finance has directed NAICOM to provide legal justification for the disputed charges and ordered the suspension of enforcement against NICON and Nigeria Re pending determination of their petition.

Royal Exchange Prudential Life is pursuing a fresh capital raise after failing to appear on the verified list. Its parent company has obtained approval for a N2.7 billion capital injection through a public offering.

Universal Insurance had earlier secured shareholder approval to raise N15 billion, but still failed to obtain NAICOM’s compliance confirmation by the deadline. The insurer has since entered into an agreement with FPNG Co-Nvest Limited for a N7.128 billion capital injection in exchange for shares, a transaction expected to give FPNG a 50.1 per cent stake.

NAICOM has previously said it is committed to preventing the collapse of licensed insurers while protecting policyholders during the recapitalisation process.

The regulator’s immediate challenge is therefore to balance strict enforcement of the new capital regime with an orderly resolution of the six outstanding cases.

For the insurance industry, the conclusion of the exercise marks a shift from raising capital to deploying it. The stronger capital base of compliant operators is expected to improve their ability to absorb risks, underwrite larger transactions, settle claims and support investment.

For the six excluded firms, however, the next phase will be critical. Their ability to complete pending capital raises, resolve legal disputes or secure alternative restructuring arrangements could determine whether they remain active participants in Nigeria’s insurance market.