The National Insurance Commission, NAICOM, has issued operational guidelines to simplify licensing procedures for InsurTech entities, enhance consumer protection, and foster digital innovation within the sector.
The new framework, in effect since 1 August 2025, aims to reduce regulatory uncertainty, boost consumer trust, and accelerate the development of tailored insurance services.
The guidelines set out two categories of InsurTech operators:
- Partnering InsurTechs, which are technology companies allowed to offer specific insurance services only through partnerships with licensed insurers.
- Standalone InsurTechs, which are independently licensed entities permitted to operate within approved insurance classes. However, they are restricted from offering high-risk insurance products such as oil and gas, marine and aviation, retirement life annuities, and coverage for government assets or liabilities.
The new regulatory framework includes the following:
Prudential and Market Conduct Requirements: InsurTech firms must comply with provisions related to risk management, investment practices, actuarial standards, outsourcing, and other key operational parameters as detailed in the Commission’s Prudential Guidelines.
Dispute Resolution Mechanism: Disputes between InsurTechs and partner insurers must first follow arbitration protocols outlined in their agreements before approaching NAICOM. Consumers may refer unresolved issues from insurance transactions to the Commission for review and resolution.
The guidelines were unveiled following consultations with industry stakeholders.