NAICOM Hails Passage of Insurance Consolidated Bill, Predicts Boost to GDP
By Patience Ikpeme
The National Insurance Commission (NAICOM) has endorsed the passage of the new Insurance Consolidated Bill by the Senate, hailing it as a “game changer” for Nigeria’s insurance industry. The Commission anticipates that the new legislation will significantly boost the sector’s contribution to the nation’s Gross Domestic Product (GDP) and the economy as a whole.
NAICOM warmly welcomed the Bill, expressing optimism that it will unlock growth, prosperity, and untapped potential within the insurance sector. The passage of this Bill marks a crucial milestone in the country’s efforts to revitalize the industry after nearly two decades of operating under outdated legislation.
The newly passed bill introduces several key provisions designed to strengthen Nigeria’s insurance landscape. Among the most significant highlights are: the Bill establishes new minimum capital requirements for insurance companies, ensuring they possess sufficient capital to underwrite risks effectively and provide adequate protection for policyholders. This provision aims to enhance the financial stability and resilience of insurance firms.
The legislation consolidates the risk-based approach to supervision, empowering regulators to more effectively monitor and manage risks within the industry. This modern supervisory framework will allow for more proactive and targeted oversight. The Bill includes improved consumer protection measures, designed to safeguard the interests of policyholders and promote transparency and fairness in insurance practices. This will build greater public trust and confidence in the sector, and the legislation establishes an enhanced regulatory framework, providing greater clarity and consistency in the regulation of insurance businesses. This will facilitate a more efficient and effective supervisory process for NAICOM.
NAICOM believes that by consolidating existing insurance laws, the new legislation represents a step forward in strengthening Nigeria’s insurance industry. The Bill provides a comprehensive framework for regulating all types of insurance businesses, ensuring a more robust and effective industry overall.
The passage of the Bill is seen as a major victory for Nigeria’s insurance sector, directly addressing the long-standing challenge of low insurance penetration in the country. The new legislation provides the industry with the more robust legal and regulatory framework it needs to compete effectively in the African and global insurance markets.
This achievement comes after years of operating under laws that have failed to keep pace with Nigeria’s evolving economic landscape. Unlike other sectors that have undergone multiple phases of legislative reforms to reflect current economic realities, the insurance sector has been operating with outdated laws for a considerable period.
The passage of this Consolidated Bill is therefore seen as a crucial step in modernizing the sector and enabling it to play a more significant role in Nigeria’s economic development. NAICOM believes that this new legal framework will attract more investment into the sector, encourage innovation, and ultimately benefit consumers and the Nigerian economy.
