Brokers Urged to Brace for Sweeping Insurance Reforms in Nigeria

The Nigerian insurance industry is on the brink of major transformation as the Nigerian Insurance Industry Reform Act Bill, 2025, awaits presidential assent. Having cleared both chambers of the National Assembly, the bill introduces wide-ranging reforms that seek to overhaul the regulatory landscape, strengthen corporate governance, and enhance the overall integrity of the industry. As the sector stands poised for this significant shift, insurance brokers, in particular, are being urged to prepare for the forthcoming changes that will reshape how they operate and compete.

One of the bill’s most notable features is the drastic revision of capital requirements for insurers and reinsurers. Under the new legislation, non-life insurance companies must now have a minimum capital base of ₦15 billion, a fivefold increase from the previous ₦3 billion. Life insurers will be required to raise their capital from ₦2 billion to ₦10 billion, while reinsurance firms will need to meet a new minimum of ₦35 billion, up from ₦10 billion. These steep hikes are expected to trigger a wave of recapitalization across the industry, with analysts projecting a cumulative capital injection of over ₦600 billion.

While these changes directly affect underwriting firms, insurance brokers are not left out. The new law stipulates that all insurance and reinsurance brokers must renew their licenses within six months prior to expiry—a move aimed at ensuring continuous regulatory compliance and weeding out non-performing operators. This requirement underscores a broader push toward stricter oversight and greater accountability among intermediaries.

Beyond licensing, industry stakeholders are calling for reforms to broker capital requirements as well. Tony Elumelu, Chairman of Heirs Holdings, has been one of the more vocal proponents of elevating professional standards within the sector. He recently advocated for increasing the capital base for brokers from ₦5 million to ₦50 million, arguing that a higher financial threshold would boost professionalism and help eliminate unethical practices such as rate cutting and delayed premium remittances. Elumelu emphasized that the future of insurance in Nigeria hinges on restoring trust and credibility—an effort in which brokers play a pivotal role.

This sentiment is echoed by the Nigerian Council of Registered Insurance Brokers (NCRIB), which has consistently pushed for improvements in industry conduct and policy compliance. The Council recently urged the Federal Government to ensure that all public projects in the 2025 national budget are adequately insured, reiterating the crucial role that brokers play in risk assessment, coverage coordination, and claims management. By integrating insurance more deeply into public spending plans, NCRIB believes the government can safeguard its investments while also strengthening the domestic insurance market.

At the heart of these reforms is the drive to modernize and professionalize the Nigerian insurance industry in line with global standards. The bill introduces mechanisms for more transparent reporting, stronger corporate governance, and greater consumer protection. For brokers, this means stepping up operational standards, improving record-keeping, and adopting digital solutions to remain competitive and compliant.

Technology is expected to play a vital role in this transition. With the rise of insurtech and digital platforms, brokers will need to embrace innovations that simplify customer onboarding, streamline claims processing, and provide data-driven insights. Digital compliance tools, customer relationship management systems, and secure online payment platforms are becoming increasingly important as clients demand faster, more transparent service delivery.

At the same time, brokers must invest in continuous professional development. With the regulatory environment becoming more complex, staying abreast of new rules, international best practices, and technological trends will be essential. Many industry leaders have emphasized the need for structured training programs, certifications, and peer learning forums to build a future-ready workforce.

The insurance reform bill also encourages deeper collaboration between regulatory bodies and private sector players. Institutions such as the National Insurance Commission (NAICOM) will be empowered to take a more active role in monitoring market practices, enforcing penalties, and providing guidance to operators. For brokers, maintaining open lines of communication with regulators and participating in industry consultations will be key to navigating the evolving landscape.

Despite the challenges that lie ahead, there is optimism that the reforms could usher in a new era of growth and stability for Nigeria’s insurance industry. By improving capital adequacy, enforcing ethical standards, and promoting technological adoption, the reforms aim to build a more resilient and inclusive insurance ecosystem.

For brokers, the message is clear: brace for change, adapt swiftly, and commit to higher standards. The path forward may be demanding, but with the right strategies, Nigeria’s insurance intermediaries can thrive in a more structured and transparent market environment. As the country awaits the final assent of the reform bill, industry players are advised to begin preparations now, aligning their operations with the new requirements and positioning themselves for long-term success.