Insurance companies operating in Nigeria have been told that raising large amounts of capital will not keep them afloat unless they build strong internal controls and maintain proper board oversight.
The National Insurance Commission gave the warning during the eighth Annual Insurance Directors’ Conference held in Lagos, according to Punch. The event, organised alongside the College of Insurance and Financial Management, focused on steering the industry into a risk-based capital era.
Olusegun Omosehin, the Commissioner for Insurance and Chief Executive of NAICOM, stated that raising new funds is only an initial step. He noted that poor management, bad investment choices, and ineffective risk frameworks could easily wipe out fresh capital. He cautioned that recapitalisation is merely an entry point to stricter regulatory supervision, pointing out that meeting base capital rules does not mean a company holds enough buffer to cover its actual business risks.
Under the risk-based system, NAICOM will monitor how firms handle financial reporting, risk levels, and claims payments. Omosehin explained that bad underwriting, uncontrolled company growth, and bloated operating expenses could quickly drain an insurer’s resources.
Speaking at the gathering, the President of the Chartered Insurance Institute of Nigeria, Akinjide Orimilade, reminded company leaders that board seats are not ceremonial titles. He warned that directors could be held legally responsible if weak supervision harms their institutions. Orimilade disclosed that roughly 50 insurers have crossed the recapitalisation benchmark, with NAICOM recording around N715bn in statutory capital. He pointed to the Nigerian Insurance Industry Reform Act, enacted on 31 July 2025, as the foundation for the sweeping industry changes.
The Special Adviser to the President on Economic Affairs, Tope Fasua, also urged firms to rebuild public trust, broaden market reach, and adapt their business models to handle rapid technological changes and evolving customer needs.
