nsurers are required to review and strengthen their bond underwriting practices and procedures as part of the measures in making insurance bonds a mandatory pre-requisite
As the deadline for insurance recapitalisation approaches, an uncomfortable question is echoing across Nigeria’s financial sector. If many insurance companies are as successful and profitable as they claim, why are so many scrambling at the last minute to raise capital?
The question may sound harsh, but it goes to the heart of the ongoing recapitalisation exercise that is expected to reshape Nigeria’s insurance industry. With the July 2026 deadline around the corner, several insurers are rushing to the capital market, seeking billions of naira through rights issues, private placements and other funding mechanisms to meet the new minimum capital requirements stipulated under the Nigerian Insurance Industry Reform Act (NIIRA) 2025.
“Across the world, financial sector reforms often lead to mergers, acquisitions and strategic alliances. Stronger institutions emerge, weaker ones combine resources, and customers ultimately benefit from more resilient companies.”
On the surface, recapitalisation is a welcome development. A stronger and better-capitalised insurance industry is essential for a nation that aspires to become a trillion-dollar economy. Large infrastructure projects, aviation, marine operations, oil and gas investments, agriculture and emerging technology sectors all require insurers with the financial capacity to underwrite significant risks.
