Follow Us on Google
By Henry Uche
Following key reforms that kicked off in 2025, stakeholders in Nigeria’s insurance sector have highlighted the expansion of compulsory insurance, stricter enforcement and the digitisation of processes as top priorities for this year.
They said that broadening insurance coverage and leveraging technology to streamline compliance are critical to protecting consumers, reducing fraud and improving operational efficiency.
They urged regulators, industry operators and government agencies to collaborate closely to ensure these reforms are implemented swiftly and effectively.
2025 in retrospect
The Nigerian insurance industry experienced a year of both challenges and milestones in 2025, navigating economic headwinds while laying the groundwork for a transformative 2026. Analysts, operators, educators, and experts are optimistic that, with the ongoing reforms, strategic policies, and technological adoption, the sector is now positioned for sustainable growth and increased penetration across the economy.
Speaking on the state of the industry, insurance consultant Mr. Aluor Stephen Agusah described 2025 as “one of the most defining periods for the Nigerian insurance industry.” Despite macroeconomic challenges, including inflationary pressures, weakened consumer purchasing power, volatile operating costs, and sector-wide restructuring—Agusah commended the sector for ending the year stronger, more resilient, and better positioned for the future.
On prospects for 2026, he said: “We anticipate 2026 to be a pivotal year for the Nigerian insurance industry, particularly as the reforms under the Nigeria Insurance Industry Reform Act (NIIRA) 2025 begin to take full effect. NIIRA represents the most transformative regulatory framework in recent years, and we view it as a catalyst for industry-wide modernization.”
Agusah highlighted several key areas of focus for the upcoming year:
Digitisation and compliance automation
“NIIRA’s mandate for greater transparency, data accuracy, and digital reporting aligns with our ongoing investments in technology. We expect increased automation of compliance processes, improved identity verification using BVN, NIN, and RC numbers, and more structured reporting to enhance industry credibility,” he explained.
Strengthened market conduct and governance
“NIIRA provides clearer governance and consumer protection expectations. Insurers and intermediaries will be required to raise internal standards. The industry is fully aligned with these expectations, and most organisations have already begun enhancing governance frameworks,” Agusah added.
Expansion of compulsory insurance and improved enforcement
He noted that the new reforms are expected to result in stronger enforcement of compulsory insurance classes, expanding market coverage and improving industry penetration. “This presents significant opportunity for insurers who are prepared, compliant, and operationally ready,” he said.
According to Agusah, digital adoption across the value chain will accelerate in line with the reforms. “As an organisation heavily invested in digital capabilities, this positions us advantageously for 2026,” he noted.
Agusah, who oversees commercial activities in a microinsurance company, also shared expectations from the government and NAICOM. “We look to the Federal Government and NAICOM for clear and timely implementation guidelines for NIIRA to support smooth industry transition; a stronger enforcement of compulsory insurance to enable the sector to fulfil its economic role; support for digital infrastructure, including identity verification systems and harmonised regulatory reporting platforms; and stakeholder collaboration to ensure insurers, brokers, fintechs, and government agencies align on execution,” he said.
He added that despite the economic pressures of 2025, most organisations remained resilient, innovative, and strategically positioned for growth. “The reforms under NIIRA provide a unique opportunity to strengthen the industry’s foundation, deepen trust, expand penetration, and unlock new value across the economy. The industry should remain committed to delivering customer-focused protection, advancing digital transformation, maintaining strong governance, and contributing meaningfully to the growth and stability of Nigeria’s insurance ecosystem in 2026 and beyond,” he advocated.
For Mr. Niyi Onifade, MD/CEO of Heirs Life Assurance, a member of Heirs Insurance Group, 2025 was a landmark year. “It was a very strong year, not just for our business, but for the insurance industry at large. A major turning point was the signing of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 by Mr. President on 31 July 2025, which has fundamentally reshaped the operating landscape in a positive way,” he said.
“The new Act strengthens the industry through a higher capital base, accelerates digitisation, reinforces compulsory insurance products, introduces the ECOWAS Brown Card framework, and establishes the Policyholders’ Protection Fund. All of these measures are critical for stability, trust, and long-term growth,” Onifade added.
Heirs Life Assurance’s MD noted that while audited figures for 2025 are still pending, preliminary results indicate strong performance. “Based on current results, we expect no less than a 100% increase in financial performance by the end of 2025. However, for us, success is not just about numbers. It is about how well we deliver on our promise to the public. That promise is simple and consistent: to improve lives and transform society.”
Amid economic headwinds, Onifade stressed that clarity of purpose and execution were key to resilience. “We set out to democratise access to insurance and make insurance a part of everyday life. Everything we did in 2025—product design, customer experience, digital platforms, and service delivery—was focused on making insurance simple, accessible, and trustworthy. We do not believe insurance policies should require magnifying glasses to read. At Heirs Insurance Group, simplicity and transparency are non-negotiable. Today, with just a few taps on your mobile phone, you can access our products and services.”
On claims management, he emphasised the importance of fulfilling insurance promises. “Claims are the end product of insurance; they are the promise fulfilled. Any delayed or denied claim is, in my view, a breach of contract. I am proud to say that over 90% of our claims are currently paid within 48 hours. This is a major differentiator for us, and we are pushing further. We are targeting 90–95% of claims paid within 24 hours, with many settled within hours, sometimes even within one hour.”
For 2026, Onifade expressed optimism about the insurance industry and Nigeria’s economy. “From the Federal Government’s budget, it is clear that there is a deliberate plan to stabilise and grow the economy. In our own space, we are fully aligned with these aspirations and committed to supporting them. We expect the full implementation of NIIRA 2025 to drive even deeper reforms. By mid-2026, the insurance capitalisation exercise should be completed. The banking sector consolidation will also have been concluded, and the new tax regime will take effect from January 1. Together, these reforms will have positive ripple effects across the economy.”
Onifade observed encouraging macroeconomic signals, including relative foreign exchange stability and declining inflation—from 18% to around 14.5%, according to the National Bureau of Statistics. He added, “When the economy improves, the insurance industry improves with it. For us at Heirs Insurance Group, 2026 will be about raising the bar even higher. We will continue to lead in making insurance a lifestyle, expanding access, building trust, and delivering real value to Nigerians. In this next phase, Heirs Insurance Group will not just participate in the industry’s growth—we will lead it. We intend to be the vanguard and cornerstone of an insurance industry that truly improves lives and transforms society.”
For insurance educator Dr. Olufemi Abbas, former Head of Insurance at Lagos State University, 2025 saw growth in awareness and stability in the sector. “The insurance sector rating for 2025 was considerably fair.
It has grown, though penetration is not yet optimal, but awareness is improving. People are getting more information about insurance,” he noted.
Abbas cautioned, however, that increased awareness has not always translated to higher insurance purchases. “Awareness is on the high side. NAICOM is not leaving any stone unturned with awareness campaigns. NIA is also at the forefront, giving better orientation to the public. Insurance companies paid huge claim amounts in 2025, and claim denials reduced. So the industry is waxing stronger, coupled with the recapitalisation exercise as insurers brace up for deadlines.”
He urged NAICOM to intensify advocacy efforts, noting that strategic partnerships with other government agencies could amplify impact. “As the biggest spender, if NAICOM engages more in awareness campaigns, it would be even better,” he said.
Dr. Abbas also encouraged underwriters to prioritise value-added services. “Not everyone will receive claim payments, but insurers can demonstrate value through non-monetary services—safety tips, callbacks, customer engagement. If people feel valued, they focus less on claims as their primary reason for buying insurance.”
With regards to 2026, Abbas hopes to see stronger, more reliable, and competitive insurance companies. “We need more collaboration among NICRIB, NIA, loss adjusters, and agents. Micro and inclusive insurance must expand. We need operators in the informal sector, broader coverage segments, and visible impact from recapitalisation on Nigerians and the economy. Service delivery must improve, penetration must increase, and regulators must continue advocacy. When all these are done efficiently and effectively, insurance will be stronger and better for everyone,” he concluded.
