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Driving growth with recapitalisation – The Nation Newspaper
With macroeconomic headwinds still blowing, regulatory shakeups underway, and citizens demanding more value for their trust, Omobola Tolu-Kusimo writes on whether 2026 could be the year these industries either break new ground or stay stuck in the cycle of unrealized potential.
The year 2025 ended with increased premiums, improved regulatory oversight, and renewed investor interest following NAICOM’s enforcement of the Nigerian Insurance Industry Reform Act, 2025 (NIIRA 2025).reforms and recapitalisation efforts.
However, insurance penetration remains below 1per cent, a stubborn reminder of trust deficits and policy design mismatched with market realities.
In 2026, the focus is expected to be on Expanding microinsurance and digital distribution to reach the informal sector.
Focus will also be on how the industry will close claims trust gap through improved payout transparency; Enhancing fire and property insurance compliance, especially in high-risk zones; and Driving collaboration with state governments on compulsory insurance enforcement
Similarly, with climate-related risks like market fires and floods increasing, insurers will be under pressure to move from risk avoidance to proactive risk management and inclusion.
Pensions: The Balancing Act Continues
For the Contributory Pension Scheme (CPS) managed by PenCom, 2025 showed steady growth in assets now crossing N18 trillion and moderate expansion in the Retirement Savings Account (RSA) base. However, concerns linger around benefit adequacy, especially for informal workers and those nearing retirement.
In 2026, key expectations include- Strengthening the Micro Pension Plan to deepen coverage; More RSA transfer activity as competition among PFAs grows; Investment diversification into infrastructure and impact sectors; and Enhanced retirement planning education to close literacy gaps.
Meanwhile, under the Defined Benefit Scheme (DBS) administered by PTAD, continued efforts to clear backlog payments, implement biometric verification, and digitize pension records will define service delivery.
The Real Question: Inclusion or Isolation?
Both sectors face a common challenge on how to serve more Nigerians better. With only 19 million Nigerians enrolled in pensions and fewer than 2 million insurance policyholders, the industries are barely scratching the surface of a 230 million-strong population.
To shift from numbers to impact in 2026, stakeholders must Prioritize user education and financial literacy; Redesign products to fit real needs; and Build trust through service delivery and accountability
Final Word
2026 holds promise but delivery is key. Insurance and pension operators must align business interests with national needs, and regulators must be firm yet enabling. Nigerians, especially the youth and informal sector, are watching.
Can the sectors rise to meet them halfway? Only time and execution will tell.
Regulator, Operators Projections
PenCom
In an interview with journalists in Lagos, the Director General of PenCom, Ms. Omolola Oloworaran said her plan for 2026 would continue to revolve around building trust among retirees and Retirment Saving Account (RSA) holders.
She further disclosed that improving investments options for Pension Fund Administrators (PFAs) that allows them work towards the parts where returns on investment for retirees and RSAs surpass inflation.
Most importantly, we want to ensure that the right of retirees and RSAs earn good income at retirement. Generally, this continues to be our frontline plan and we will build reforms around them, she said.
NAICOM
The Commissioner for Insurance of NAICOM, Mr. Olusegun Omoseyin said Nigeria’s insurance sector stands at a defining moment.
He stated that while they have made progress in regulatory reforms and market development, the reality remains that this industry is still undercapitalized and underpenetrated.
He said: “Insurance penetration hovers below one per cent of Gross Domestic Product (GDP), behind global and even regional averages. As the World Bank reminds us, “Financial resilience is not a luxury; it is a necessity for sustainable development.” Recapitalization is not just a compliance exercise; it is a strategic imperative. But let me emphasize: resilience requires more than capital. The goal is no longer just solvency; it is about building the capacity to withstand shocks, adapt to change, and thrive in uncertainty.
“Under the Nigerian Insurance Industry Reform Act (NIIRA) 2025 and the guidelines issued by the commission, we have set clear expectations by specifying the Minimum Capital Requirements (MCR). We have also constituted an in-house Committee to drive the recapitalization exercise. We issued an MCR Circular followed by comprehensive guidelines for MCR to provide regulatory clarity.
“We also set very clear compliance timelines which includes 30th September 2025: Submission of recapitalization plans; 10 working days after month-end: Monthly progress reports; and November 2025 – June 2026 for Capital verification.
Beyond capital, Omosehin reiterated that capital is the floor, not the ceiling.
He said to achieve resilience, they must Address emerging risks such as climate change, cyber threats, health crises, supply chain disruptions, and political volatility; Develop local data and risk models suited to Nigeria’s realities; Embed ESG and sustainability principles in underwriting and investment; Move from being mere risk transferors to risk managers and mitigators.
“Capacity building must extend beyond financial capital to human capital, that is, technical skills, leadership, actuarial and innovation mindset. Capacity must also extend to technological capacity such as, catastrophe modelling, insurtech adoption, data analytics, and digital distribution. As the African Insurance Organization noted recently, “The future of African insurance will be digital, data-driven, and customer-centric.”
Speaking on the game changer for 2026, the commissioner said recapitalization will reshape the industry. It will lead to strategic mergers and acquisitions, creating stronger entities.
“But collaboration must go further. Reinsurance partnerships should evolve from transactional to strategic. Public-private partnerships can drive inclusive insurance and deepen penetration. Regulators, insurers, reinsurers, and other stakeholder must work together to mobilize capital and expertise. Under the African Continental Free Trade Area (AfCFTA), we must leverage regional platforms for cross-border growth, harmonizing standards and unlocking scale.
“Our ultimate goal is competitiveness and adaptability, not mere compliance. This requires transparency and trust, especially in claims settlement, alignment of policy, capital, and innovation to support national economic stability, and a shared commitment to transform insurance from a peripheral service to a central pillar of Nigeria’s economic resilience”.
He encouraged operators that recapitalization is not an end; it is the beginning of a new era.
“It is the foundation upon which we will build a resilient, innovative, and globally competitive insurance sector. NAICOM stands ready to facilitate this journey through guidance, engagement, and collaboration. We urge every stakeholder here to embrace this moment, not as a regulatory burden, but as a strategic opportunity to redefine our industry’s future.
“Together, let us move beyond solvency to resilience, beyond compliance to competitiveness, and beyond borders to continental leadership, and above all, beyond MCR to RBC”, he stressed.
Operators
The Chairman, Nigerian Insurers Association (NIA), Kunle Ahmed in his new year message to member companies of the association pledged to establish a recapitalisation help desk to assist them during the transition.
He appreciated their commitment to client’s satisfaction, unwavering support, resilience, and collaborative spirit, which together defined the remarkable progress of the association and the Nigerian insurance industry in 2025.
He disclosed that the past year was transformative for the NIA, marked by initiatives that deepened the market, boosted public confidence, and strengthened stakeholder engagement.
He said: “In 2025, the NIIRA Act was signed into law, creating a stronger framework for insurance penetration, governance, and sustainable growth.
“As 2026 begins, the priority is its effective implementation through collaboration among companies, regulators, and stakeholders. The NIA has pledged continued support via advocacy, guidance, capacity-building, and plans to establish a recapitalisation help desk to assist members during the transition.
“With cooperation, transparency, and shared responsibility, I am confident we will consolidate the gains of 2025 and usher in a new era of growth and public trust”, he added.
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