President Bola Ahmed Tinubu has signed the Nigerian Insurance Industry Reform Act (NIIRA) 2025, introducing sweeping changes to strengthen compliance, raise penalties, and boost confidence in the insurance sector.
Under Section 75 of the Act, all petroleum and gas refilling stations, as well as vehicles transporting such products, must have third-party insurance against losses from accidental fire or explosions. Insurance certificates must be displayed prominently at refilling stations or included in transport documents. Non-compliance attracts a fine of at least ₦1 million or a minimum two-year jail term.
The law also increases penalties for non-insurance of public buildings, raising fines from ₦100,000 to at least ₦1 million, with possible imprisonment of up to 12 months. Section 76 makes it mandatory for all public buildings to be insured against hazards such as fire, collapse, earthquake, storm, and flood, covering both property damage and third-party liabilities.
To support emergency services, direct insurers must remit 0.25% of net premiums quarterly to the Fire Services Maintenance Fund, with penalties of up to 10 times the outstanding amount for non-compliance.
The Act also introduces stricter enforcement on claim settlements. Any insurer with at least five verified complaints of delayed claims payment risks licence cancellation. Failure to maintain required reserves or meet capital and solvency standards also constitutes grounds for licence revocation.
In line with the Act, the National Insurance Commission (NAICOM) has inaugurated the 2025 Recapitalisation Committee, chaired by Mrs. Oluwatoyin Charles, Director of Supervision. The 11-member team will design a recapitalisation roadmap, develop new guidelines on minimum capital requirements, and identify possible regulatory incentives. The committee will submit monthly reports to NAICOM management and quarterly updates to the Governing Board and stakeholders.
Commissioner for Insurance, Olusegun Ayo Omosehin, stressed that recapitalisation is critical to stabilising the sector and advancing the Federal Government’s vision of a $1 trillion economy. He pledged full support for the committee and urged members to work with diligence, transparency, and professionalism.
NAICOM said the NIIRA 2025 positions Nigeria’s insurance industry for greater transparency, innovation, and global competitiveness.
