Insurers must separate life, general businesses by 2030,

•Rules out extension as experts hail move

By Henry Uche

The 12 composite insurance companies in the country have five years from the day of presidential ascent to Nigerian Insurance Industry Reforms Act (NIIRA) 2025, to separate their life and general Insurance businesses.

This would mean that each of the two business segments will operate as a distinct company, with separate management and board that must be approved by the Commission.

Composite Insurance Companies are licensed by NAICOM to operate in both life and general (non-life) insurance business.

NAICOM ensures these companies maintain proper risk management, solvency standards and comply with all regulatory requirements for dual-sector operations.

To this end, the existing composite underwriters in the country have up until 2030 to do this to avoid regulatory sanction.

The NIIRA 2025 did not make provision for composite license, even, in the ongoing recapitalisation exercise but instead treat each of these businesses as a separate company.

Therefore, those with a composite license will be treated as if they have two registered companies, and then need to add the minimum capital of a Life and Non-Life companies together to arrive at their respective minimum capital.

While Life Operators are expected to upgrade capital from N2billion to N10billion, Non-Life operators are to upgrade from N3billion to N15billion as provided by the Act. Each composite insurer will then add N10 billion for Life and N15billion for Non-Life to arrive at N25billion minimum capital.

However, going forward, the regulator has instructed them to begin the process of separating both businesses going forward.

The companies affected include: AIICO Insurance Plc, NSIA Insurance Limited, Cornerstone Insurance Plc, Lasaco Assurance Plc, Alliance and General Insurance Plc, AXA Mansard Insurance Plc.

Others are: Fortis Global Insurance Plc, Goldlink Insurance Plc, Great Nigeria Insurance Plc, Industrial and General Insurance(IGI) Plc, Leadway Assurance Company Limited and NICON Insurance Plc.

Confirming this development at a press briefing in Lagos recently, the Commissioner for Insurance said, NIIRA 2025 has already made provisions for such businesses to be separated, adding that, NAICOM will effectively carry out to the letter, every provision to ensure players are in tune with the regulation.

Part II, Section 3 (1) of NIIRA Act, under (Classification) says, “There shall be for the purpose of this Act two main categories of insurance business, that is (a) life insurance business, and (b) non-life insurance business.

Omosehin assured that the Commission will not shift any deadline that had already been stipulated in the new insurance Act, urging operators to comply accordingly.

Experts in the sector have maintained that players have ample time to do the needful, explaining that it is ideal and a way to ensure stronger financial protection, increase greater transparency, and guarantee better risk management.

Other insurance enthusiasts who do not want to be mentioned affirmed that such a policy decision would boost investor confidence, encourage specialization and position Nigeria’s insurance sector to align with global best practices.

“The policy is about making the insurance industry safer, clearer, and stronger for everyone involved”, the insurance expert pointed out.