4
LAGOS – Following the presidential assent to the Nigerian Insurance Industry Reform Act (NIIRA 2025) on the 31st July, 2025 and the commencement of the sector’s recapitalisation exercise, the National Insurance Commission (NAICOM) has warned that any company that fails to meet the prescribed minimum capital requirement (MCR) within the stipulated timeframe shall be subject to liquidation, merger, or any other regulatory resolution action as may be deemed appropriate by the Commission.
The Commission has also directed all insurance companies and reinsurers to commence the recapitalization exercise of their firms forthwith stipulating a timeline of 12 months with effect from July 31, 2025 when the reform bill was signed into law by the president and to 31st July 2026.
The NIIRA 2025 introduces higher Minimum Capital Requirements (MCR) of N10billion, N15billion, N25billion and N35billion for life, non-life, composite and reinsurance companies respectively and a shift to a Risk-Based Capital (RBC) framework for insurance and reinsurance companies in Nigeria.
The statement from the Commission recently reads: “Implementation Of The New Minimum Capital Requirement (MCR) Prescribed By The Nigerian Insurance Industry Reform Act (NIIRA) 2025
“Following the enactment of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 and assent of His Excellency, President Bola Ahmed Tinubu, GCFR on the 31stof July 2025, the Commission hereby notifies all insurance and reinsurance companies of the commencement of the recapitalisation exercise as prescribed by the NIIRA 2025.
“Minimum Capital Requirement and Risk-Based Capital The NIIRA 2025 introduces higher Minimum Capital Requirements (MCR) of N10billion, N15billion, N25billion and N35billion for life, non-life, composite and reinsurance companies respectively and a shift to a Risk-Based Capital (RBC) framework for insurance and reinsurance companies in Nigeria.
In line with the provisions of the Act, the new MCR takes effect from the date of Presidential assent, and all operators are required to comply fully within a twelve (12) month period from the effective date.
Effective Date and Compliance Period: In line with the provisions of the Act, the new MCR takes effect from the date of Presidential assent, that is 31st July, 2025. A 12-month period has been provided for insurers and reinsurers to comply with the new MCR as well as the applicable RBC as may be determined.
All insurers and reinsurers shall comply with the requirements on or before the 30th day of July 2026.”
Read the full article here
