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The National Insurance Commission (NAICOM) has set a deadline of September 30, 2025, for insurance and reinsurance companies to submit their recapitalization plans.
This move, according to the Commission, is part of the implementation of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 which aligns with the NAICOM’s draft Guidelines on the implementation of the Minimum Capital Requirements (MCR) for insurance and reinsurance companies operating in Nigeria.
According to Section 12 of the draft guidelines, “Insurers and Reinsurers shall submit their recapitalization plans and relevant information to the Commission on or before September 30, 2025.
The plan must include, among other things: a Board Resolution detailing how the company intends to comply with the provisions of these Guidelines and other applicable insurance laws; the capital status of the company based on its 2024 Audited Financial Statements and Q2 Returns as of June 30, 2025, in line with the requirements of the Guidelines; and a comprehensive action plan outlining the amount (s) and source (s) of capital injection, along with timelines and expected deliverables.”
Companies planning to raise funds from the capital markets must submit their action plans on a file-and-use basis. Those intending to merge with or acquire another company are required to submit their proposals, and subsequently comply with the provisions of these Guidelines and existing insurance laws. In cases where a composite company chooses to discontinue a particular class of insurance business, it must provide a Portfolio Transfer or Run-Off Plan.
The guidelines also mandate that companies submit a Recapitalization Progress Report on a monthly basis, no later than five working days after the end of each month.
This report should include the company’s MCR status computed using the designated MCR Template, along with milestones achieved and efforts undertaken to meet the recapitalization targets.
Even after meeting the required MCR, companies must continue submitting updated MCR status reports monthly until a license is issued, or until otherwise directed by the Commission.
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.
NAICOM had set 30th July 2026, as the deadline for all insurers and reinsurers to comply with the new capital requirements.