The Senate has passed, after a third reading, the Insurance Regulatory Commission Bill that among various provisions, will rename the National Insurance Commission (NAICOM) and set out a new legal framework for regulating Nigeria's insurance industry.
The law, when passed, will repeal the nearly three-decade-old National Insurance Commission (NAICOM) Act of 1997. It seeks to modernise insurance regulation, strengthen oversight of the industry and align Nigeria’s insurance sector with international best practices.
The Bill updates provisions relating to supervision, inspection and regulatory intervention, enabling the regulator to respond more effectively to emerging challenges within the insurance industry. The highlights of the Bill are:
- Rebranding: NAICOM will be renamed the Insurance Regulatory Commission.
- Greater powers and authority: The regulator will be granted greater powers to discharge its statutory responsibilities without undue interference, including issuing guidelines, collaborating with international regulatory bodies, and intervening early in troubled insurers to safeguard policyholders and safeguard financial stability.
- Stricter governance requirements: The legislation stipulates professional qualifications and suitability standards for appointments to the regulator’s governing board. Those who sit on the board are to be experts in insurance, finance, risk management, law and corporate governance.
- Tougher endorsement measures: The new law will introduce stricter enforcement measures, including sanctions, higher fines, licence suspension, and permanent disqualification of individuals guilty of regulatory breaches.
Following its passage in the Senate, the Insurance Regulatory Commission Bill will be sent to the House of Representatives before being forwarded for presidential assent.