The recapitalisation was irrevocably set 31 July 2026 by NIIRA 2025 and the requirements accompanying the exercise. All operators were routinely briefed as what was required to scale the hurdle.
The regulator National Insurance Commission (NAICOM), ab initio said it was open to accommodate all and when necessary point companies that are at crossroads to the way they ought to follow. The Commission said it was disposed to assist because there are no preferred entities on its list. The high calibre Commissioners said it preferred the route of accommodating possibly all because the risk based supervision when activated will tell the story of each operator as it is and assign the cocktail of classes of business it can embrace. Therefore, RBS becomes the upgraded dimension that precisely drops each qualified operator in the classes of business it should be associated with.
While grappling with the number of successful companies and those that will be separated from the operating space when the curtain drops by midnight of 31 July 2026, NAICOM had its plough on RBS that number of successful was outside the walls of RBS which was set to welcome current operators that will define the present and future of the insurance market.
The unsuccessful ones, Staco Insurance, Universal Insurance, A&G Life, Goldlink Insurance, NICON Insurance and Nigeria Reinsurance. The last three have their licences revoked by the Commission while NICON and Nigeria Re in the category have instituted legal proceedings against the Commission
Now the industry has 50 licenced operators, 48 insurers comprises life, non-life and composite,and, two reinsurers, awash with high dose of operating capital to penetrate the economy with what insurance can do hitherto not done. Outside of this camp are the unsuccessful operators that fell while trying to lift above the requirement hurdles. The reasonable palliatives dropped along the route by way of constant nodge to put the directors on their toes were not under the recapitalisation current. The current was low, clear and transparent enough to avoid the to avoid where there was fall.
The fall points were clearly identified so that it could be avoided as companies embarked on the twelve month recapitalisation journey. The fall was created for those who were likely to miss the requirement to assemble at the point of upgraded dimension in insurance industry.
The rescue for such operators is the books of mergers, acquisitions and the ultimate is withdrawal of licence and closure. In the case of mergers the Commissioner of Insurance Olusegun Omosehin at a media briefing earlier in the year said the Commission will be handed the responsibility of merging those were recapitalisation compliant into blocks of companies.
The CFI did not rule out the fact that in such circumstances an unwilling company might have to be in the same boat with another and learn to clear the working space for each other.
There are chances he said that an attractive company might be acquired if it favours the long term corporate goal of acquiring insurer. Fitting the companies in this group into lumps that will make them fit is not an easy route and the Commission admits that.
In a clime where mergers are not explored for inherent potentials the option will stand, but in Nigeria where it is not a common occurence it could well be a dusting road with undulating topography where the compass to lead to the right space most times, do not have due diligence component attached to it. Sometimes, when one exists certain disclosures expected to accompany it might be expunged and shielded, making mergers a tall order, a difficult sell. Same for acquisition.
