12 Insurers Face July Deadline as NAICOM Rules Out Extension on Recapitalisation

With the July 31, 2026 recapitalisation deadline approaching, several insurance firms risk failing to meet the new capital thresholds set by the Nigerian Insurance Industry Reform Act 2025, industry findings show.

Under the NIIRA 2025, life insurance companies must raise their operating capital from N2 billion to N10 billion, general insurers from N3 billion to N15 billion, and reinsurance firms from N10 billion to N35 billion. The sector currently has 29 general insurers, 14 life insurers, 12 composite firms, and three reinsurers, covering about five million insured persons alongside corporate clients.

The National Insurance Commission met last week with about 12 insurers seen as “largely motionless” in the recapitalisation drive. Commissioner for Insurance Segun Omosehin told the firms the July 31, 2026 deadline will not be extended, noting that only an amendment to the NIIRA 2025 can shift the date.

Omosehin asked the affected companies to outline the challenges slowing their efforts and offered guidance on compliance. He warned that firms that fail to meet the requirement risk deregistration by August 2026.

At least 20 insurers have written to NAICOM stating they are ready for verification, Omosehin said. Verifiers have been assigned to review their books and report back within three weeks.

Investigations indicate some companies are weighing whether to drop either their life or general insurance lines to fit into a lower capital band. One firm that attended the NAICOM meeting has reportedly resolved to shut its life arm and focus solely on general insurance to meet the requirement.

Several insurers have approached the NGX to raise funds. Guinea Insurance is seeking N5.8 billion via a rights issue, Linkage Assurance N16.3 billion, Lasaco Assurance N18.47 billion, SUNU Assurance N9.34 billion, Sovereign Trust N5.02 billion, and Universal Insurance N15 billion.

Industry analysts expect the deadline to trigger mergers and acquisitions as weaker firms look for lifelines from stronger players. Consolidation could strengthen the sector’s capital base and improve capacity to underwrite large risks, but may reduce competition in the near term, they noted.

Market operators cite high interest rates, investor apathy, and historically low sector returns as hurdles to raising fresh equity. Rights issues and public offers have seen limited interest, pushing some companies toward private placements and strategic partnerships

For now, NAICOM maintains that the recapitalisation push is non-negotiable. Firms that cannot meet the new thresholds by July 31, 2026 will have to exit or merge, reshaping Nigeria’s insurance landscape.