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Tag: Insurance

  • Insurance industry braves odds

    Insurance industry braves odds

    Despite economic headwinds and persistent public skepticism, Nigeria’s insurance industry showed renewed signs of life in 2025. This review takes a closer look at how both the regulator and operators have fared and what still needs fixing. Omobola Tolu-Kusimo writes.

    Nigeria’s pension sector anchored by the Contributory Pension Scheme (CPS) under the Pension Reform Act (PRA) 2014 continues to demonstrate resilience and gradual progress.

    While total assets and membership have grown significantly in recent years, long standing structural gaps and implementation shortfalls remain key concerns for stakeholders.

    In 2025, Nigeria’s pension assets under management experienced continued expansion, building on momentum from previous years.

    The industry during the period under review was led by a new Director-General, National Pension Commission (PenCom) Ms Omolola Oloworaran, who was appointed on July 13, 2024 and confirmed by the Senate by November 21.

    By January 2025, total pension assets rose to about N22.9 trillion, marking a 17per cent year on year increase and reflecting positive contributions and market performance.

    By May 2025, assets climbed further to N24.10 trillion, as funds maintained steady monthly growth.

    In June and August 2025, contributions and strategic rebalancing pushed pension Asset under Management (AUM) to at least N24.63 trillion and N25.9 trillion, respectively.

    By October 2025, total pension assets hit approximately N26.66 trillion, underscoring resilience amid economic headwinds.

    The upward trajectory of pension assets reflects consistent employer and employee contributions, improved investment allocations, and confidence in the CPS framework from institutional investors.

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    Membership numbers have also grown. By Q3 2024, there were more than 10.5 million Retirement Savings Accounts (RSAs) substantially up from earlier years and continued registration in 2025 is expected to push these figures higher.

    Developments/achievements

    There has been sustained asset growth in the past one year. The consistent growth in AUM demonstrates that the industry continues to mobilize long term savings effectively, turning contributions into significant capital pools that can support investment and retiree benefits.

    Similarly, the industry witnessed improved investment returns. Some pension fund administrators (PFAs) delivered strong returns across RSA fund types, particularly in growth oriented funds that benefit from equities and fixed income instruments managed for stability and long term gains.

    PenCom on its part introduced revised investment regulations to guard assets and diversify investment portfolios, including clearer rules on allowable asset classes and risk management.

    Besides, micro pension initiatives aimed at informal sector workers have seen 51per cent growth in enrolment, though coverage remains limited relative to the informal workforce.

    The Pension Fund Operators Association of Nigeria (PenOp), Chief Operating Officer (COO), Anthonia Ifeanyi-Okoro praised digital reforms, specialized projects, and leadership efforts as steps toward a more vibrant and sustainable pension’s ecosystem.

    Challenges

    While industry fundamentals have strengthened, several issues persist ranging from low overall penetration, low informal sector coverage, state compliance issues, inflation impact on pension returns, retirement experience, among others.

    Nigeria’s pension penetration relative to the working population and Gross Domestic Product (GDP) remains modest. Large segments of the workforce especially in the informal sector of the economy remain outside the CPS, despite initiatives like micro pension plans.

    On informal sector coverage, although there is growth in micro pension participation, the informal sector which constitutes an over 90per cent of Nigeria’s workforce remains undercovered.

    This highlights a gap between policy intention and operational inclusion.

    Several states have lagged in fully implementing the CPS, meaning many pensioners may not receive consistent benefits as designed by the 2014 Act. This reflects a need for stronger enforcement and political consensus.

    Although assets have grown, returns particularly real returns net of inflation remain a concern for many contributors approaching retirement, especially where heavy dependence on government securities limits exposure to higher growth instruments.

    Meanwhile, reports from retirees in some quarters indicate delays or inadequate benefit adequacy, issues tied to legacy challenges and uneven implementation across regions and employer groups.

    Oloworaranm while reeling out her achievement for the year titled: “A 365-Day Scorecard” said: “One year ago, I was confirmed as Director General of PenCom with a clear mandate: to rebuild trust, expand coverage, strengthen governance, and move the Contributory Pension Scheme firmly into its next phase.

     “I am proud to say that this past year has been defined by bold decisions, structural reforms, and measurable impact. We formally launched Pension Revolution 2.0, the most comprehensive reform agenda in the Nigerian pension industry since 2004. This was not cosmetic reform. It was structural. It brought together new regulations, stronger supervision, governance reforms, digital transformation, and industry realignment, all designed to future- proof the pension system and position it as a pillar of national stability and long-term development.

    “One of the most historic milestones of the year was the Presidential approval and disbursement of N758 billion to settle outstanding pension liabilities. This unprecedented intervention sent a clear and powerful signal that Nigeria honours its promises to its workers and retirees. We also cleared long-standing pension increase backlogs for Federal Government treasury-funded retirees, some dating as far back as 2007. What many believed would never be paid has now been paid.

    “In addition, zero waiting time for the payment of accrued pension rights was restored with effect from July 2025. Today, retirees receive their benefits when due, not months or years later. To further enhance benefit adequacy, we introduced Pension Boost 1.0, which has already added N2.68 billion to monthly pension payments for CPS retirees. These are not just numbers. They are meals on tables, medicines purchased, and dignity preserved.”

  • ‘70% of Nigerians lack insurance cover’

    ‘70% of Nigerians lack insurance cover’

    Nigeria’s insurance industry continues to experience notable growth, yet the market remains largely underpenetrated.

    The Nigeria Council of Registered Insurance Brokers (NCRIB) said about 70 per cent of Nigerians still do not have any form of insurance cover.

    This is despite increased awareness and regulatory reforms.

    Insurance penetration in the country hovers around four per cent, underscoring significant untapped potential, it said.

    This state of affairs was made known at NCRIBAbuja Area Committee Professional Members’ Evening, a gathering that convened senior industry leaders to discuss the future of insurance brokerage in Nigeria.

    Among the participants was Nelson Akerele, Chief Executive Officer of Enterprise Life, a leading player in Nigeria’s insurance brokerage landscape.

    The session, recognised as one of the industry’s most strategic networking forums, offered an evening of insights, professional exchange, and renewed commitment to advancing Nigeria’s insurance ecosystem.

    The Abuja meeting follows a similar edition held in Port Harcourt in November 2025, reflecting NCRIB’s strengthened regional engagement drive.

    It was noted that the industry has recorded remarkable performance: Total Gross Written Premium (GWP) rose to N1.562 trillion in 2024, a 56 per cent increase from the previous year. The sector’s total assets expanded to N3.9 trillion, marking a 46.1 per cent year-on-year growth.

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    Non-life insurance continues to drive the bulk of premium contributions, reflecting the evolving needs of Nigeria’s individuals and businesses. With over 300 registered brokerage firms under NCRIB nationwide, brokers remain central to driving market expansion, advising clients, and ensuring regulatory compliance.

    Speaking at the event, Nelson Akerele commended NCRIB’s effort in offering platforms that elevate the insurance brokerage profession and encourage collaboration among industry players. “As brokers, we play a crucial role in deepening insurance penetration in Nigeria. Sessions like this empower us to share knowledge, build stronger connections, and collectively strengthen the profession. Enterprise Life is committed to contributing meaningfully to this progress through ethical practice, client-centric advisory, and innovative partnerships,” he said.

    The evening featured discussions on regulatory alignment, talent development, emerging market opportunities, and the role of technology in reshaping industry operations. It also served as a strategic platform for strengthening relationships with underwriters, corporate institutions, and fellow brokers across the region.

    The Abuja Professional Members’ Evening comes on the heels of the Port Harcourt Area Committee session held in November, demonstrating NCRIB’s commitment to continuous engagement and broadening participation across Nigeria’s major commercial hubs.

    Both gatherings underscore a sector-wide effort to promote public awareness around the value of insurance and encourage collaboration among brokers, regulators, and insurers.

    As the industry evolves supported by digital transformation, regulatory momentum, and a growing appetite for risk management, Enterprise Life continues to position itself at the forefront of solutions that meet the needs of individuals, SMEs, and corporate clients.

  • Insurance thought leaders chart growth path at IMT 4.0

    Insurance thought leaders chart growth path at IMT 4.0

    Leading industry thought leaders have chart growth path for the insurance industry at IMT 4.0, a West Africa’s leading platform for advancing insurance innovation, policy dialogue, and operational efficiency.

    The fourth edition of Insurance Meets Tech (IMT 4.0) achieved record attendance of leading C-suite leaders as well as a sold-out participation in its youth segment of the conference.

    With the theme: “Innovating for the New Trybe”, the 2025 edition positioned youth, technology, and trust at the centre of insurance’s next growth phase. It marked a defining moment for industry, as ideas and actions converged to set the tone for a trillion-dollar economy.

    Discussions at the conference also centred, among other things, on how to bridge traditional insurance structures with emerging, technology-driven solutions, emphasising digital adoption, innovation, and client-centred experiences.  

    Leading an executive dialogue to discuss the Nigeria Insurance Industry Reform Act (NIIRA) 2025, recently signed into law by President Bola Ahmed Tinubu, was the Commissioner for Insurance and Chief Executive Officer of NAICOM, Mr Olusegun Omosehin, who was represented at the event by the Deputy Commissioner for Insurance (Finance & Administration), Mr Ekerete Ola Gam-Ikon.

    Omosehin stated that the NIIRA 2025, signed into law in July 2025, will foster economic growth by transforming the sector through increased capital, stronger policyholder protection via a Policyholder Protection Fund, digitalisation, microinsurance promotion, and alignment with global best practices.

    He said: “The Act is a warm piece of legislation that provides the blueprint to reset the industry”, he said. “This Act bridges the gap between what family and friends traditionally provide and what insurance should guarantee. Nigerians can now be confident that when something goes wrong, insurance will deliver,” he explained.

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    Omosehin highlighted that NIIRA’s recapitalisation will increase insurers’ capacity to handle risks and retain local businesses, contributing to the nation’s vision of a one trillion dollar economy.

    The Chairman, Nigerian Insurers Association (NIA), Mr. Kunle Ahmed, who is also the MD/CEO of AXA Mansard Insurance Plc, said, “NIIRA 2025 represents a bold step toward strengthening the regulatory framework, enhancing public trust, improving market penetration, and modernising operations within the industry. It reflects the Federal Government’s commitment to deepening financial inclusion and ensuring that insurance becomes a robust pillar in Nigeria’s economic framework, in line with the President’s vision for achieving a $1 trillion economy by 2030.

    “This is not just a legislative victory; it is a shared mission. NIA stands ready to champion a more resilient and customer-centric insurance sector that contributes meaningfully to national development.”

    In her contribution to the discourse on NIIRA 2025, the President of the Chartered Insurance Institute of Nigeria (CIIN), Mrs Yetunde Ilori, said, “The insurance industry is set for unprecedented transformation following the signing of the Act.

    “It introduced critical measures such as stringent capital requirements to ensure the financial soundness of operators, enforcement of compulsory insurance policies to enhance consumer protection, digitisation of the insurance market to improve access and efficiency, zero tolerance for delays in claims settlement, creation of dedicated policyholder protection funds, especially in cases of insolvency, and expanded participation in regional insurance schemes, including the ECOWAS Brown Card System.

    The President of the Nigerian Council of Registered Insurance Brokers, Prince Babatunde Oguntade, who was represented at the conference by Mr. Peter Offiong, Assistant General Manager at Scib Nigeria & Co. Ltd, while stressing the need for immediate implementation of the Act, highlighted NIIRA’s provisions on compulsory insurance, emphasising that digital platforms and collaboration with state agencies will support enforcement.

    He emphasised that brokers remain central to the ecosystem. “Brokers will evolve into digitally empowered advisers who offer customised, transparent services. The Act safeguards their relevance while ensuring consumer adoption of compulsory insurance,” he said.

    The Managing Director, SanlamAllianz Life Insurance, Tunde Mimiko whose organisation was IMT 4.0’s Official Insurer, stressed the need for the industry to build systems that move beyond legacy bottlenecks, strengthen compliance, and foster greater trust with policyholders. He emphasised that such developments are crucial for safeguarding customers and positioning insurance as a key driver of financial security and sustainable growth in Nigeria.

    The Managing Director, Cornerstone Insurance Plc, Stephen Alangbo on his part emphasised the company’s role as an innovation partner, focusing on digital transformation, customer-centric solutions, and the use of Insurtech to shape the future of inclusive coverage in Africa.

    He highlighted Cornerstone’s commitment to leveraging technology and developing innovative products to meet dynamic market needs, as outlined in their strategy for leading the African insurance industry.

    The event also featured global thought leadership and the conference’s Headline Speaker, Per Lagerström, a former McKinsey partner and the CEO of Yellowspot. He challenged Nigerian insurers to rethink their models, emphasising the human element in innovation. “Insurance is not built on products alone; it is built on behaviour. If we do not understand how people earn, live, and dream, we cannot design solutions they will embrace. Technology gives us the tools, but human insight gives us the answers.”

    In his opening remarks, the convener of the IMT Conference and the Managing Director/CEO of Modion Communications, Mr. Odion Aleobua, called on insurance innovators to build distribution that meets people where they are: online, on mobile, at work, and in communities, while conforming to evolving lifestyles. He called on regulators to adopt regulations that protect consumers without stifling industry innovation.

    He also noted that the high calibre of sponsors, participants, and partners, including the Commissioner for Insurance, regulators, and industry leaders, reflected a collective commitment to shaping a future of innovation and digital adoption within the Nigerian insurance industry.

  • Major investors eye stakes in insurance sector

    Major investors eye stakes in insurance sector

    Major foreign and domestic investors are eyeing stakes in Nigeria’s insurance sector as firms begin the process to raise fund, it was learnt at the weekend.

    Investment banking sources said there were early indications that the implementation of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 might lead to emergence of new major investors in the sector.

    This came as insurance companies began pre-offer processes to raise new capital to meet new thresholds set by the NIIRA 2025.

    Guinea Insurance at the said it has placed approval for new capital raising as a special business at its annual general meeting scheduled for upper week.

     The firm is seeking shareholders’ approval to “authorise its directors to take all necessary steps to increase the minimum share capital of the company by way of private placement, rights issue, strategic equity investment, public offer, or any combination thereof as the directors may deem appropriate”.

    NIIRA 2025 increases the minimum capital for life insurance businesses from N2 billion to N10 billion, non-life insurance firms from N3 billion to N15 billion and reinsurance companies from N10 billion to N35 billion.

    Sources said there have been early enquiries around opportunities in the insurance sector in the light of certain provisions of the new Act.

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    The sources said the upsurge in demand for insurance stocks might not be unconnected with moves by existing and new investors to take positions ahead of expected fund raisings, especially with the prevalence of rights issue as means of recapitalisation.

    Most banks that had raised funds under the banking sector recapitalisation programme had used rights issue, which pre-allot shares to existing shareholders based on their holdings as at a particular date.

    Insurance stocks were the three most active stocks at the Nigerian Exchange (NGX).

    Trading report at the weekend showed that the trio of Universal Insurance Plc, Linkage Assurance Plc and AIICO Insurance Plc accounted for about 32.5 per cent of the total turnover at the NGX.

    Managing Director, APT Securities & Funds Limited, Mallam Garba Kurfi, said the recapitalisation of the insurance sector could see a redirection of substantial foreign investments into the sector.

    “Definitely we expect to see foreign inflows in view of the opportunities given to Insurance companies by the new Act,” Kurfi said.

    Managing Director, Arthur Steven Asset Management, Mr. Olatunde Amolegbe, said the recapitalisation of the insurance sector is necessary given the critical role of the sector in driving and sustaining economic growth.

    He said the increased capitalisation would strengthen insurers’ capacity to underwrite larger risks that might arise in pursuit of the government economic goals, opening up insurance to new major players.

    Managing Director, HighCap Securities, Mr. David Adonri, said there were justification for recapitalisation of the insurance industry, considering the increased risks that insurance companies shall be underwriting under the new Act.

    Adonri said: “It will certainly bring in new capital and investors but some may choose the option of combination. The publicly quoted ones can access new capital through the capital market.”

  • Countdown to insurance, reinsurance companies recapitalisation exercise begins

    Countdown to insurance, reinsurance companies recapitalisation exercise begins

    Countdown to insurance, reinsurance companies recapitalisation exercise began July 31, says NAICOM

    The National Insurance Commission (NAICOM) has notified all insurance and reinsurance companies of the commencement of the recapitalisation exercise, effective July 31, 2025 as prescribed by the Nigerian Insurance Industry Reform Act (NIIRA) 2025

     The regulator mandated the operators to comply fully within 12 months from July 31, 2025.

     The NIIRA 2025 introduces higher Minimum Capital Requirements (MCR) of N10bn, N15bn, N25bn, and N35bn for life, non-life, composite, and reinsurance companies respectively, and a shift to a Risk-Based Capital (RBC) framework.

     This is also coming following the enactment of NIIRA 2025 and assent of President Bola Ahmed Tinubu on July 31, 2025

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     The Commissioner for Insurance, NAICOM, Mr Olusegun Omosehin in the circular to the companies stated that insurers and reinsurers must comply on or before 30th July 2026. Companies must start preparations immediately to comply within the 12-month period.

    Deputy Commissioner for Insurance, Technical, Dr. Usman Jankara said the Commission will issue guidelines detailing:

    Composition of MCR; Acceptable forms of capital;  Capital verification procedures;  Qualifying assets and criteria; and Standardised computation template

     Others to be considered are Treatment of Assets; Verification of Assets; Issuance of New Certificates and Fees; Engagement with Stakeholders.

    The Commission will liaise with SEC, CAC, NRS, and other stakeholders to secure incentives and concessions.; Transparency and Value Addition,; and In-House Committee.

  • Investors scramble for insurance stocks on new sector’s Act

    Investors scramble for insurance stocks on new sector’s Act

    • Equities rally N479 billion gain

    Insurance stocks were the toasts at the stock market yesterday as investors upped demand for insurers on expectations that a new sectoral law would stimulate growth and returns.

    President Bola Tinubu had on Tuesday signed the Nigerian Insurance Industry Reform Act (NIIRA) 2025, paving the way for extensive reform of the industry.

    NIIRA 2025 makes provisions for significant recapitalisation, enforcement of compulsory insurance and operational governance among others.

    The NGX Insurance Index, which tracks the insurance sector, recorded the highest gain of 8.76 per cent.

    Major insurance stocks such NEM Insurance, 9.93 per cent;  AXA Mansard, 10.00 per cent and AIICO Insurance, 10.00 per cent; recorded the highest possible daily gain yesterday.

    The Consumer Goods Index rose by  4.08 per cent while the NGX Banking Index appreciated by 0.20 per cent.

    The rally in the financial services sector, led by insurance companies, extended the bullish trading at the Nigerian equities market to its 26th day, with investors gaining N479 billion.

    The All-Share Index (ASI) gained 756.85 points, representing a gain of 0.52 per cent to close at 146,570.71 points. Also, market capitalisation rose by N479 billion to close at N92.731 trillion.

    Investor sentiment, as measured by market breadth closed positive as 44 stocks advanced, while 34 declined. AIICO Insurance, Cornerstone Insurance, AXA Mansard Insurance and University Press emerged the highest price gainer of 10 per cent each to close at N3.19, N5.83, N13.31 and N5.61 respectively, per share.

    Guinness Nigeria followed with a gain of 9.98 per cent to close at N141.60, while UPDC up by 9.94 per cent to close at N7.19, per share. On the other side, Chams Holding Company led others on the losers’ chart with 9.94 per cent to close at N2.90, per share. Austin Laz & Company followed with a decline of 9.83 per cent to close at N2.11, while Caverton Offshore Support Group declined by 9.65 per cent to close at N6.37, per share

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    UACN shed 9.44 per cent to close at N81.50, while John Holt lost 9.43 per cent to close at N7.20, per share.

    However, the total volume traded dipped by 26.5 per cent to 1.983 million units, valued at N27.262 billion, and exchanged in 35,291 deals. Transactions in the shares of Linkage Assurance led the activity with 372.402 million shares worth N703.098 million. Prestige Assurance followed with account of 249.327 million shares valued at N357.453 million, while Veritas Kapital Assurance traded 181.867 million shares valued at N362.998 million.

    Sterling Financial Holdings Company traded 121.019 million shares worth N968.287 million, while Lasaco Assurance traded 58.721 million shares worth N217.540 million.

  • Insurance firms set for merger, acquisition to raise capital base

    Insurance firms set for merger, acquisition to raise capital base

    • New law streamlines sector to play bigger role in $1tr economy target

    The insurance sector has been set on a path to playing a bigger role in the actualisation of the $1 trillion economy target of the Tinubu Administration.

    This follows the signing of the Nigerian Insurance Industry Reform (NIIRA) 2025 Bill by President Bola Ahmed Tinubu.

    The Act, which repealed and consolidated all outdated insurance legislation into a single, modern framework, has raised the imminence of mergers and acquisitions in the insurance industry.

    The Act increases the minimum capital for life insurance businesses from N2 billion to N10 billion, non-life insurance firms from N3 billion to N15 billion and reinsurance companies from N10 billion to N35 billion.

    The Presidency yesterday directed the National Insurance Commission (NAICOM) to administer and implement the provisions of the NIIRA 2025 in a manner that unlocks the industry’s full potential and significantly improves insurance penetration across the country.

    The sector, after consolidation of firms to meet the new capitalisation threshold, is expected to play a big role in the targeted $1trillion economy.

    NAICOM is expected to issue guidelines on the operation of the Act, especially given the need for a transitional period and an orderly process of the recapitalisation.

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    Experts expect to see considerable mergers and acquisitions within the industry, although there is strong optimism that many of the 55 insurance companies operating now may scale the recapitalisation hurdle.

    In a statement by Special Adviser to the President, Information and Strategy, Bayo Onanuga, the Presidency stated that the Act is expected to overhaul the sector.

    “This development reaffirms the administration’s commitment to financial stability, economic development, and inclusive growth.

    “The NIIRA Act 2025 ushers in a new era of transparency, innovation, and global competitiveness for the insurance industry.

    “It aligns with the Federal Government’s vision of achieving a $1 trillion economy,” the Presidency stated.

    It listed the merits of the act as follows:

    *Introduction of critical measures, such as stringent capital requirements to ensure the financial soundness of operators, and enforcement of compulsory insurance policies to enhance consumer protection;

    *Digitisation of the insurance market to improve access and efficiency;

    *Zero tolerance for delays in claims settlement;

    *Creation of dedicated policyholder protection funds, especially in cases of insolvency and expanded participation in regional insurance schemes, including the ECOWAS Brown Card System;

    *Catalysation of new investments, boosting of consumer confidence, and positioning Nigeria as a leading insurance hub in Africa.

    The Senate passed the Bill on December 17, 2023, while the House of Representatives passed it on March 13.

    Thereafter, a harmonised bill was presented to the President.

    Experts applauded the Act, describing it as a necessity for the industry’s transformation.

    Chief Executive Officer, Council of Insurance Brokers, Mr. Tope Adaramola, commended President Tinubu.

    He believes the Act would address the industry’s weaknesses and optimise its potential.

    He said: “This is a development that industry operators and financial analysts have been waiting for, because the insurance industry, despite its enormous potential, has not been able to maximise that potential because of numerous constraints.

    “One of these constraints was that the government needed to give enough enabling environment to the industry to thrive, bearing in mind that in Nigeria, unlike some other advanced economies, insurance is sold and not bought.

    “The law comes with a lot of positives for the insurance industry in alignment with the aspirations of governments towards making our economy a $1 trillion economy.

    “The issue of higher capitalisation for insurance operators is going to broaden their capability to underwrite risks, which are often ceded outside the country.”

    According to him, with the impending enhanced capacity, Nigerian insurers can retain most of their risks in Nigeria, with multiplier benefits on the economy generally.

    He added that the issue of compulsory insurance has also been addressed, as the government will become more supportive in ensuring that all the compulsory insurance that are extant, but that are not given the required backing, are appropriately addressed.

    “Imagine the multipliers of, for instance, sections 65, 64, 64, 65 of the Insurance Act, which talk about insurance of public buildings, and buildings under construction.

    “That alone, with government backing, can unleash unprecedented premiums that will broaden the scope of insurance practice as well as its sovereignty.

    “There’s nothing that is happening in the insurance industry as part of the financial ecosystem that will not affect the totality of the economy, including unemployment.

    “The industry will be in a better position to broaden its employment capability and complement the vision of the government towards reducing unemployment.

    “It will also make the industry contribute more to national development,” Adaramola said.

    Managing Director, AIICO Capital, Dr Femi Ademola, said it was a good development that the new insurance law has been assented to by the President.

    “It portends the opportunity of waking up the sleeping Nigerian insurance sector through the strengthening of regulations, boosting insurers’ capitalisation and enforcement of compulsory insurance.

    “The rush to increase capital base by the insurance companies would spur capital market activities, while the separation of licenses has the potential to improve industry expertise.

    “By far the most important development is the enforcement of compulsory insurance to deepen insurance awareness and penetration.

    “The law has the potential to increase the size of the industry within a very short period,” Ademola, a chartered financial analyst (CFA), said.

    AIICO Capital is a member of one of Nigeria’s largest insurance groups.

    Managing Director, Arthur Steven Asset Management, Mr Olatunde Amolegbe, said the new Act would play complementary roles in the ongoing recalibration of the nation’s financial system.

    “The insurance industry is needed to provide risk sharing and protection for various sectors as the economy grows, and it cannot do this effectively if the industry itself is not well capitalised. You cannot grow beyond your size.

    “So, while the banks now have the capacity to finance large ticket transactions due to enlarged capital, the insurance industry also has to boost its capacity to underwrite larger transactions.

    “With this new move, hopefully, underwriting transactions that typically have been outsourced abroad will now be done locally.

    “Secondly, that industry also provides critical investment capital to critical sectors within the economy, so the ability to play this role on a larger scale will also improve if they become better capitalised.

    “Beyond the business aspect, it also strengthens regulation within the industry and hopefully will improve transparency and accountability.

    “All in all, I think it is a positive move by the government,” Amolegbe, a senior investment analyst, said.

    Agusto & Co estimated that recapitalisation of existing insurance businesses alone would add some N600 billion in new equity funds to the insurance industry.

    Recapitalisation is expected to provide headroom for operational performance as insurers strive to optimise enlarged assets.

    Agusto & Co. approximated gross revenue for the Nigerian insurance industry to N1.1 trillion in 2024, with the new law expected to deepen the industry’s double-digit growth.

    The average growth rate for the Nigerian insurance industry in the recent period was more than 30 per cent. However, insurance penetration is less than one per cent.

  • Students urged to adopt insurance as career

    Students urged to adopt insurance as career

    Students of Insurance and Actuarial Science Department of the University of Lagos (UNILAG) and Accountancy Department, Yaba College of Technology (YABATECH) Lagos trooped out in large numbers to receive insurance practitioners led by the Chartered Insurance Institute of Nigeria (CIIN), who took awareness campaign to the school.

    The campaign was part of the week-long Insurance Awareness Week.

    The immediate past Rector College of Insurance and Financial Management (CIFM), Dr Yeside Oyetayo, called on the students to consider taking insurance as a career.

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    She assured them that irrespective of any course studied in the university, opportunities abound for them in insurance.

    She stressed that insurance has gone digital, adding that the industry is recruiting a lot of computer science graduates.

    She stated that they have shared a book that illustrates how students could write insurance exams and invited them to think about insurance as it is the next-generation financial sector.

  • Nigeria loses $500m annually to war insurance despite piracy-free waters

    Nigeria loses $500m annually to war insurance despite piracy-free waters

    Notwithstanding achieving a three-year milestone without a single piracy attack on vessels bound for Nigeria through the Gulf of Guinea, the country has lost over $1.5 billion in “War Risk Insurance premiums” to foreign insurers.

    According to the Sea and Empowerment and Research Centre (SEREC), the country pays an average of $500 million annually in war risk surcharges imposed by international shipping firms, despite the successful deployment of the “Deep Blue Project”, which has significantly improved maritime security.

     “This is a huge financial burden that does not reflect our current maritime reality. Nigeria has not recorded a single piracy incident in three years, yet international insurers continue to treat our waters as high-risk. This must stop,” SEREC’s Head of Research, Eugene Nweke highlighted in the centre’s latest bulletin.

    The bulletin emphasised that War Risk Insurance, originally introduced to protect vessels navigating conflict-prone zones, remains in place long after the risk has been mitigated. It indicated the premium consists of two major components, including War Risk Liability, which insures the people and goods aboard the vessel, and War Risk Hull, which insures the vessel itself.

    It however, noted, the claim that eliminating these premiums could save Nigeria over $400 billion annually seems to be an estimate of potential annual savings, rather than a direct calculation based on the $1.5 billion paid over three years.

    “SEREC notes that the relationship between the $500 million annual premium payment and the $400 billion potential annual savings is not directly proportional. Further clarification on the figures would require more specific and up-to-date data from NIMASA or other authoritative sources,” Nweke explained.

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    He also raised concern about the “opportunity costs” of maintaining maritime security at such a high financial input. While praising the Deep Blue Project for eliminating piracy, he noted that funds allocated to security might have been invested in critical sectors such as port modernisation, logistics infrastructure, or fisheries development.

     “Imagine the impact if such investments had been redirected into the fishing industry or transport logistics—both of which are vital to trade and food security,” the bulletin read.

    The research group called on the government to “intensify diplomatic engagement with global insurance underwriters”, urging a thorough reassessment of the country’s maritime risk profile in line with the country’s current security status.

    It also acknowledged that regulatory agencies like the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigerian Shippers’ Council (NSC) have already launched a campaign aimed at scrapping the war risk surcharge altogether. These agencies, it said, argued that Nigeria’s improved maritime safety should lead to the removal of such levies, which inflate the cost of shipping and ultimately drive up the price of goods.

     “Insurers must align their premiums with the present-day realities in Nigerian waters. Security has drastically improved, yet we are still being economically punished for a threat that no longer exists,” the group insisted.

    It also commended the Minister of Marine and Blue Economy for providing strategic leadership and sustaining the Deep Blue Project, which has earned the country global recognition.

    In conclusion, SEREC maintained that the benefits of zero piracy, including enhanced trade, increased investor confidence, and maritime stability, far outweigh the associated security expenditure but insisted that the financial exploitation via insurance premiums must be addressed immediately to unlock the full economic value of the country’s maritime reforms.

  • How Does Term Insurance Help Business Owners Protect Their Income?

    How Does Term Insurance Help Business Owners Protect Their Income?

    Running a business is filled with both opportunity and risk. As a business owner, your personal financial decisions are deeply intertwined with your professional responsibilities.

    This is where term insurance plays a critical role. A term insurance plan provides pure life cover for a fixed period and ensures your dependents receive financial support during your untimely death. For entrepreneurs, this means safeguarding both family and business continuity.

    How Term Insurance Provides Security to Entrepreneurs?

    As a business owner, you carry both personal and professional responsibilities. Term insurance ensures that your dependents and business can withstand the financial challenges caused by your absence.

    1. Financial Protection for Family and Heirs

    Your family may not be actively involved in running your business. Without a proper plan, their future can be uncertain. Term insurance ensures they remain financially secure.

    ● Covers outstanding home and personal loans

    ● Supports children’s education and future goals

    ● Helps maintain lifestyle and day-to-day expenses

    ● Prevents financial dependence on relatives or selling business assets

    2. Business Loan Protection

    Most businesses run on borrowed capital. If you were to pass away, your personal or business loans could burden your family or co-founders.

    ● Pays off business or personal loans

    ● Clears EMIs or credit lines linked to the business

    ● Prevents asset liquidation or distress selling

    ● Reduces debt-related pressure on heirs and stakeholders

    3. Continuity for Business Partners

    Your sudden absence can disrupt business operations and confuse succession or shareholding. A term policy ensures smooth continuation.

    ● Enables partners to buy your business share

    ● Prevents ownership disputes among family and stakeholders

    ● Facilitates planned business succession

    ● Supports business operations without pause

    4. Tax Benefits and Affordable Premiums

    Entrepreneurs often look for tax-efficient investments. Term insurance offers protection and helps optimise annual tax outgo.

    ● Premiums eligible under Section 80C

    ● Death benefits tax-free under Section 10(10D)*

    ● Cost-effective compared to other insurance types

    ● Large cover at a low premium for young policyholders

    *Subject to prevailing tax laws and conditions

    How Single Premium Term Insurance Works for Business Owners?

    Single-premium term insurance allows business owners to make a one-time investment and stay covered for years. It eliminates the hassle of recurring payments and ensures uninterrupted coverage.

    1. What is a Single Premium Term Plan?

    Entrepreneurs often have irregular cash flows. Single premium policies are ideal as they require a one-time lump sum payment and cover you for a fixed term.

    ● One-time payment; no future premium is required

    ● Policy active for 10, 20, or 30 years (as chosen)

    ● Immediate coverage from day one

    ● No worries about missed premium dates

    2. Benefits for Entrepreneurs

    Business owners prefer simplicity and efficiency in financial tools. Single premium term insurance offers clear benefits that align with that mindset.

    a. Convenience and Peace of Mind

    You focus on running your business while the policy quietly protects your future.

    ● No need to track annual or monthly payments

    ● Suitable for those with fluctuating income

    ● Ensures uninterrupted cover

    b. Asset Allocation and Liquidity Planning

    You can earmark funds for long-term protection without disturbing your business liquidity.

    ● Use surplus funds efficiently

    ● Frees other funds for operational needs

    ● Supports overall wealth and succession planning

    c. Tax Efficiency in a Single Transaction

    Get maximum tax benefits in one financial year, especially during high-revenue periods.

    ● Full deduction available in the year of payment

    ● Simplify tax planning and compliance

    d. Ideal for Business Succession Plans

    A single premium term plan works seamlessly if you’re setting up buy-sell agreements or preparing for an exit.

    ● Immediate cover to secure succession deals

    ● Avoids delays in ownership transitions

    ● Ensures fair compensation for heirs or partners

    Key Scenarios Where Term Insurance Supports Business Owners

    Term insurance is not a one-size-fits-all solution. However, it remains a powerful safety net for entrepreneurs across different business models and stages.

    ● Startup Founders: Usually cash-strapped and focused on growth, startup founders need insurance give their family peace of mind if anything happens.

    ● Established Entrepreneurs: With growing liabilities and responsibilities, a term plan becomes crucial to protect both personal and business interests.

    ● Family Business Owners: Helps prepare for generational transition and protects family members not involved in operations.

    Tips for Choosing the Right Term Insurance Plan

    Selecting the right term plan requires thoughtful evaluation. The right plan depends on your business stage, financial goals, and family situation.

    ● Choose a High Coverage Amount: Factor in loans, lifestyle costs, education needs, and business liabilities.

    ● Pick an Adequate Term: Ideally, the cover should last until your retirement or business handover.

    ● Consider Riders: Critical illness, accidental death, or premium waiver riders offer added protection.

    ● Check Claim Settlement Ratio: A high ratio reflects the insurer’s reliability and ease of claim process.

    As an entrepreneur, you take risks every day to grow your business. But planning for the unexpected is just as important. A term insurance plan, especially a single premium option, offers a simple yet powerful way to protect your family’s future and ensure business continuity. 

    It provides financial security, supports succession planning, and ensures your legacy lives on. In the world of business, where uncertainty is constant, term insurance guarantees that your loved ones and your life’s work will be protected no matter what.