NAICOM challenges insurers to turn fresh capital into stronger

The National Insurance Commission (NAICOM) has challenged Nigerian insurers to move beyond celebrating the completion of the industry’s recapitalisation and demonstrate that the additional capital can translate into stronger underwriting capacity, faster claims settlement, technology investment and greater support for the economy.

The Commissioner for Insurance and Chief Executive Officer of NAICOM, Olusegun Ayo Omosehin, said the real test of the exercise was no longer how much capital operators raised, but how effectively they deploy it to expand the industry’s capacity and strengthen public confidence.

Omosehin, represented by Clifford Ndubem, Head of Finance, Lagos Control Office of NAICOM, spoke at the 2026 BusinessDay Insurance Conference themed, “From Capital to Capacity: Driving Growth, Innovation and Trust in Nigeria’s Insurance Sector.”

The warning comes after the conclusion of the 12-month insurance recapitalisation exercise on July 31, 2026, which saw 50 insurance and reinsurance companies meet the new capital requirements and secure re-licensing.

The exercise took total industry capital to N1.079 trillion, significantly strengthening the balance sheets of operators and creating room for insurers to retain more risks within Nigeria.

But Omosehin said stronger balance sheets would have limited economic value unless they translate into real capacity.

“Financial strength, while necessary, is not an end in itself. The true purpose of capital is to create capacity; the capacity to underwrite risks, the capacity to pay claims, the capacity to innovate, the capacity to inspire confidence, and ultimately, the capacity to support economic growth,” he said.

For the economy, the implications are significant. Stronger insurers can take on larger risks associated with infrastructure, energy, aviation, manufacturing and other major projects, reducing the extent to which Nigerian businesses must rely on foreign insurers and reinsurers for protection.

Greater risk retention could also keep more insurance premiums and investment funds within the domestic financial system, while stronger claims-paying capacity could improve confidence among businesses and households.

NAICOM is also pushing insurers to accelerate investment in technology as consumers increasingly demand faster, simpler and more transparent services.

Omosehin said insurers should use data analytics and artificial intelligence responsibly to understand customers better, improve efficiency and develop products that are more accessible and affordable.

He said technology should no longer be treated simply as a competitive advantage but as a necessity for insurers seeking to remain relevant.

Claims settlement, however, remains central to the industry’s growth prospects.

NAICOM said delayed or disputed claims continue to undermine public confidence, stressing that every claim settled efficiently strengthens insurance trust.

The focus on claims is particularly important because increasing insurance penetration will depend on convincing households and businesses that policies provide real financial protection when losses occur.

The commission’s post-recapitalisation strategy therefore places greater emphasis on converting stronger financial positions into wider economic participation.

With the banking sector having already completed its own recapitalisation, the insurance industry is now under pressure to demonstrate a similar transmission from stronger capital to productive economic activity.

The next phase will determine whether the N1.079 trillion capital base becomes simply a regulatory milestone or a foundation for a larger, more innovative insurance industry capable of supporting investment, absorbing more risks and providing greater financial protection across the Nigerian economy.