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From Adanna Nnamani, Abuja
The National Insurance Commission (NAICOM) has appointed global professional services firm Ernst & Young (EY) as consulting actuary to support the finalisation and implementation of Nigeria’s Risk-Based Capital (RBC) framework, a major regulatory reform aimed at strengthening the country’s insurance sector.
The appointment was formalised during a working meeting between NAICOM and EY in Abuja as part of the Commission’s ongoing efforts to transition the insurance industry to a more risk-sensitive capital and supervisory regime.
Speaking at the meeting, the Commissioner for Insurance, Olusegun Ayo Omosehin, said the Commission had been steadily advancing reforms designed to improve the financial soundness of insurance companies and enhance protection for policyholders.
According to him, the move towards a Risk-Based Capital framework reflects NAICOM’s commitment to aligning the Nigerian insurance industry with global best practices while ensuring insurers maintain capital levels that accurately reflect the risks they undertake.
Omosehin explained that following the recent enactment of relevant legislation and the ongoing Minimum Capital Requirement (MCR) recapitalisation exercise, the Commission had intensified efforts to operationalise an RBC framework tailored to the realities of the Nigerian market. He disclosed that the implementation of the framework would commence after the conclusion of the current recapitalisation programme. As part of the process, NAICOM plans to conduct Quantitative Impact Studies (QIS) and embark on extensive industry-wide data collection in the coming weeks.
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The studies, he noted, will help regulators assess the potential impact of the new capital regime on insurance operators, recalibrate key parameters and ensure that the final framework is both practical and effective.
Under the engagement, EY will provide technical expertise to accelerate implementation, strengthen NAICOM’s internal actuarial and supervisory capacity, and support the development of a transparent and robust regulatory framework.
The consulting firm is also expected to work closely with insurance operators and other stakeholders to develop the tools and methodologies required for seamless adoption of the new regime.
Responding, EY reiterated its commitment to delivering the assignment as a priority project. The firm pledged to collaborate closely with NAICOM and industry stakeholders to develop a Risk-Based Capital framework that is practical, implementable and aligned with the long-term growth objectives of Nigeria’s insurance sector.
Industry observers believe the introduction of the RBC framework will mark a significant milestone in the ongoing transformation of the insurance market, improving resilience, strengthening corporate governance and enhancing investor and policyholder confidence in the sector.
