Nigeria’s insurance landscape is set for a significant transformation following the passage of the *Nigeria Insurance Industry Reform Act, 2024* by the House of Representatives. This groundbreaking legislation introduces a robust legal and regulatory framework to modernize the insurance sector while enhancing protections for policyholders.
The new Act consolidates insurance laws by repealing outdated regulations, including the *Insurance Act, Cap 117*, the *Marine Insurance Act, Cap M3*, and the *Motor Vehicle (Third Party) Insurance Act, Cap M22*. It also increases the minimum capital requirements for insurers, mandating N25 billion for non-life insurance companies, N15 billion for life insurers, and N45 billion for reinsurers.
A key provision of the Act is the strict licensing requirement for insurers and reinsurers, ensuring that only qualified entities operate in the industry. It also introduces a N25 million penalty for individuals running unlicensed insurance businesses, reinforcing regulatory compliance.
Beyond regulatory reforms, the Act mandates that insurers deposit a percentage of their capital with the Central Bank of Nigeria, strengthening financial stability within the sector. Additionally, the law empowers regulators to revoke licenses of insurers failing to meet capital or solvency requirements, thereby promoting a healthier insurance industry.
With this legislative milestone, Nigeria aims to foster a more competitive and consumer-friendly insurance market, ensuring policyholders’ rights are safeguarded while enhancing investor confidence in the sector.
