By David Akinmola
The nation’s insurance industry is on a major realignment as renewed interest from local and foreign investors accelerates stake acquisitions in underwriting firms, driven by the impending recapitalization requirements of the Nigerian Insurance Industry Reform Act (NIIRA).
With new capital thresholds expected to reshape the market, the sector is witnessing heightened merger and acquisition (M&A) discussions, signaling what industry’s stakeholders described as the most consequential restructuring since the 2005 recapitalisation exercise.
Multiple industry sources confirmed that institutional investors and private equity firms are currently in talks with insurers seeking strategic partnerships or outright buyouts to meet the enhanced capital requirements.
Speaking on the development at the weekend at a industry forum, the Commissioner for Insurance, Olusegun Omosehin, said the NIIRA framework aims to strengthen operators’ financial capacity, improve shock resilience and position insurers to underwrite large and climate-related risks
“When institutions are adequately capitased,they can collaborate across the continent to pool resources and manage high-impact risks more effectively,” Omosehin said.”This is not just about compliance, it is about building resilience and ensuring underwriters remain reliable contributors to national development.”
He added that the commission is monitoring operators’ solvency positions, claims settlement patterns,and governance structures to safeguard policyholders and sustain public confidence.
Former president of the Nigerian Council of Registered Insurance Brokers (NCRIB),Prince Babatunde Oguntade, projected that about 60 per cent of insurers are on track to meet the requirements indepently, while the remaining 40 per cent may consolidate through mergers, acquisitions, or equity injections.
“With the pace of ongoing reforms, we expect insurance penetration to rise to at least three per cent within the next three years, driven by stricter enforcement of compulsory insurance and a more vibrant broker network,” Oguntade told the Guardian at an industry event in Lagos.
Data from the Nigerian Exchange (NGX) show rising investor appetite, reflected in increased share prices of listed insurance companies and a surge in capital inflows.
Stakeholders at the forum, also highlighted stronger underwriting income, improved claims ratios, and accelerated digital adoption as indicators of the industry’s upward trajectory.
Beyond the recapitalization drive, industry watchers say Nigeria is quietly emerging as a target market for global insurers seeking regional footholds.
Several foreign underwriters from Europe, North Africa, and the Middle East are reportedly reviewing Nigeria’s post-reform landscape, eyeing partnerships with firms that demonstrate strong governance and scalable distribution.
According to a Lagos-based financial advisory firm, interest is particularly strong in firms with microinsurance potential, strong digital footprints, and actuarial capacity areas expected to play major roles in expanding the national risk-pooling base.
“If effectively implemented, NIIRA 2025 could transform Nigeria into a continental hub for insurance capability and risk retention,” an industry stakeholder noted.”The reform is the reset button the sector has long needed.”
With nine months left before the recapitalization deadline, stakeholders say the industry’s ability to attract sustainable investment, deepen capital buffers and maintain sound governance will determine whether Nigeria can achieve a more competitive, resilient, and inclusive insurance market fit for a modern economy.
