NAICOM building
By David Akinmola
The National Insurance Commission (NAICOM) has raised the minimum capital requirement for national microinsurance operators to N3 billion, in a move aimed at accelerating insurance penetration among low-income population.
The new threshold, outlined in the commission’s 2026 licensing guidelines, marks a sharp increase from the previous regime, where capital requirements ranged from N40 million for unit operators to N600 million for national composite players.
Under the revised framework, operators seeking a national micro insurance licence must now meet the N3 billion benchmark to operate across all 36 states and the Federal Capital Territory (FCT), offering low-premium, simplified insurance products tailored to underserved and informal segments of the population.
NAICOM said the policy is designed to ensure operators have the financial capacity to meet obligations, particularly claims settlement, while supporting broader financial inclusion goals.
Speaking on the development, the Chairman, Nigerian Insurers Association (NIA), Kunle Ahmed, described the move as a necessary step toward building a more resilience and credible micro insurance market.
Ahmed noted that weak capitalisation had limited the ability of operators to scale and build trust, adding that stronger capital buffers would enhance claims paying and improve public confidence.
“Microinsurance is critical to deepening penetration, but built on a solid financial foundation. Adequate capital will ensure operators can deliver on their promises and expand sustainably,” he said.
A Lagos-based insurance expert, Kelvin Owok, who spoke on the ne initiative, said the recapitalization could trigger consolidation within the segment, as smaller operators may be compelled to merge or scale operation to meet the new threshold.
“The emphasis is on trust and solvency. With stronger capital, microinsurance can invest in innovation, expand distribution, and settle claims more efficiently, which are critical to winning over the informal sector,” he said.
From the industry perspective, stakeholders say the new requirement could improve confidence among low-income earners, a demographic where skepticism and low awareness have historically constrained insurance uptake.
They added that better capitalisation firms would be able to deploy technology-driven solutions and develop products suited to the realities of small businesses, farmers, and informal workers.
The move also aligns with NAICOM’s broader strategy to leverage microinsurance and Takaful as key tools for closing Nigeria’s insurance gap, with penetration still below one per cent of Gross Domestic Product (GDP).
While acknowledging potential short-term pressures on smaller operators, industry players insist that the long-term benefits stronger solvency, improved service delivery, and enhanced consumer protection will outweigh the challenges.
