The National Insurance Commission (NAICOM) has announced a sharp increase in the minimum capital base for insurance and reinsurance companies operating in Nigeria.
Under the new Nigerian Insurance Industry Reform Act 2025, non-life insurance companies must now hold a minimum capital of ₦15 billion, while life insurers are required to maintain at least ₦10 billion.
Reinsurance companies face the highest threshold, with their capital base now set at ₦35 billion.
This marks a 400 percent rise for life and non-life insurance firms and a 250 percent increase for reinsurance operators, compared to the previous requirements of ₦2 billion, ₦3 billion, and ₦10 billion respectively.
The Act also introduces a risk-based capital model, where the Commission will assess insurers’ capital needs based on factors such as insurance, market, credit, and operational risks.
Existing operators have 12 months from the commencement of the Act to comply with the new capital rules, which can be met through government bonds, treasury bills, cash equivalents, or other approved financial instruments.
NAICOM says the reform aims to strengthen the financial resilience of insurance firms, enhance policyholder protection, and boost confidence in Nigeria’s insurance industry.