There have been some takeovers and mergers as the insurance sector awaits presidential assent to the Nigerian Insurance Industry Reform Bill, writes OLUWAKEMI ABIMBOLA
on July 2nd, 2025, the National Insurance Commission issued new licenses to SanlamAllianz Life and General Insurance in Abuja after the successful merger of Sanlam and Allianz, signalling fresh energy in the insurance sector.
Upon issuing the fresh licenses, the Commissioner for Insurance, Olusegun Omosehin, urged the companies to prioritise good corporate governance, stability, and timely claims settlement processes and expressed confidence that the merger would enhance the companies’ capabilities and contribute to the industry’s growth.
Before the announcement of the SanlamAllianz merger, Endura Investment Global Limited 2024 acquired a 24 per cent controlling shareholding in Standard Alliance Insurance Plc and appointed a new board to oversee its affairs. This acquisition followed the divestment and exit of the former controlling shareholders, Standard Alliance Investment Limited, led by the founding Vice Chairman, O’tega Emerhor, from the company.
This move has resulted in a name change for Standard Alliance Insurance Plc to Fortis Global Insurance and the submission of financial statements to the Nigerian Exchange Limited (which has placed its securities on the Delisting Watchlist) up to FY 2020. If the resolutions of its June 16, 2025, Board meetings are anything to go by, then more changes are in store for Fortis Global Insurance.
These developments are coming as the insurance industry awaits presidential assent to the Insurance Industry Reform Bill, which has passed through both houses of the legislature.
The reform bill sponsored by the Chairman, Senate Committee on Banking, Insurance & Other Financial Institutions, Tokunbo Abiru, aimed to repeal the Insurance Act, Cap. I17, Laws of the Federation of Nigeria, 2004; the Marine Insurance Act, Cap. M3 Laws of the Federation of Nigeria, 2004; the Motor Vehicles (Third Party Insurance) Act, Cap. M22, Laws of the Federation of Nigeria, 2004; the National Insurance Corporation of Nigeria Act, Cap. N54, Laws of the Federation of Nigeria, 2004; the Nigeria Reinsurance Corporation Act, Cap. N131, Laws of the Federation of Nigeria, 2004; to provide for a comprehensive legal and regulatory framework for insurance business in Nigeria; and for related matters.
The Senate passed the bill in December 2024, and the House of Representatives passed it in March 2025. The Insurance Industry Reform Bill includes a wide range of reforms, including a substantial increase in minimum capital requirements for insurance companies.
The proposed new minimum non-life insurance business was N25bn, or risk-based capital as determined by NAICOM (previously N10bn). Life insurance rose to N15bn, or RBC, as determined by NAICOM (previously N8bn), and reinsurance, according to the bill, will be N45bn from N20bn, or RBC, as determined by NAICOM. The RBC requires insurers to calculate capital based on the risk they face, including insurance, market, credit, and operational risks.
Analysts maintain that while the increased capital requirements aim to bolster financial stability and enhance the sector’s capacity to absorb shocks, they may be potential challenges for smaller players in the industry and could impact market competition.
The bill also separated annuity business from individual life business, and energy (oil, gas, and power insurance) replaced oil and gas. The bill retained the ‘no premium, no cover’ principle and the maximum commission payable for different classes of business. In addition, the maximum level for group life and workmen’s compensation was included, and the commission payable should not exceed (except with prior approval from the commission) (a) 10 per cent of the premium in respect of group life assurance (not in the 2004 Act), (b) 12.5 per cent of the premium in respect of motor insurance business, (c) 15 per cent of the premium in respect of workmen’s compensation (not in the 2004 Act), or (d) 20 per cent of the premium in respect of any other class of non-life insurance business.
Subject to regulation, insurers will be at liberty to grant incentives in the form of ‘no claims’ discounts, risk improvement discounts, profit shares, and other similar forms of incentives in respect of any class of insurance, and the Commission shall from time to time issue regulations for the application and administration of such incentives.
Some of the compulsory insurances mandated by the bill include a group life assurance policy for each employee, with an erring employer facing a fine of N250,000 for every employee without a group life assurance policy or as the Commission may determine from time to time. Others are insurance for buildings under construction of more than one floor, public buildings, insurance of all Federal Government assets and employees, and all petroleum and gas stations must be insured against third-party losses from fires or explosions.
Third-party motor insurance remained compulsory, and credit providers must require borrowers taking loans over N10m to get credit life insurance. An importer, broker, or agent must obtain insurance from a Nigerian-licensed insurer for container delivery or face penalties, and the bill established a road accident victims’ compensation fund called the Road Safety and Accident Victims Compensation Fund.
Spotlighting the new capital thresholds in the bill, the immediate past president of the Chartered Insurance Institute of Nigeria, Edwin Igbiti, in an earlier chat with The PUNCH, noted, “There is no more controversy that the industry is overdue for recapitalisation if the industry has to grow. Considering the prevailing indices of inflation rate, forex rate, interest rate, and other costs of doing business, there is no way that the current capital of some insurance companies can muscle the effect of the indices on their businesses.”
He added that the new capital requirement will give room for a bigger industry in terms of capitalisation: “Big capital will lead to higher capacity for the industry. Definitely, there will be mergers and acquisitions for bigger companies to emerge.”
One such merger has been the SanlamAllianz, which predates the bill, seeing that Sanlam and Allianz officially joined forces to establish SanlamAllianz Africa in September 2023, thus becoming the largest pan-African non-banking financial services entity operating across 27 countries on the African continent.
Speaking at the launch of the JV, the Managing Director/Chief Executive Officer of SanlamAllianz General Insurance, Yomi Onifade, said, “The two groups realise that they have similar values, and the stakeholders, staff, customers, and shareholders all stand to gain from a synergy of action. When the JV was finalised in September 2023, a truly Pan-African champion was born with more than two centuries of combined experience.
“A new champion of insurance and non-banking financial services with ambitions for every player in Africa, whether individuals, public or private employees, large companies, SMEs, major projects, or large risks, but also workers in the informal sector. This champion offers life and general insurance services on the continent and also provides asset management, health coverage, and third-party payment, not to mention reinsurance through our sister company.”
Also, Endura Global Investment backing Fortis Global Insurance will likely result in the birth of at least three entities, with two playing in the insurance industry. According to resolutions of its June 16th meeting, the board of Fortis Global Insurance has resolved to create stand-alone companies or subsidiaries for its life insurance, general insurance, and investment divisions, with Fortis Global transitioning into a holding company.
Another acquisition that has fully matured is that of emPLE. In April 2024, The PUNCH reported that Old Mutual Nigeria sold its life and general insurance businesses to the emPLE Group for an undisclosed amount. emPLE Group acquired 100 per cent of Old Mutual’s equity in both businesses.
In August 2024, the new owners said the acquisition of Old Mutual’s insurance businesses in Nigeria and their transformation to emPLE mark a pivotal moment in emPLE’s journey, poised to enhance its service offerings and customer engagement, positioning itself as the premier insurer in Africa.
One of the Big Four, Deloitte, in its latest paper on the Nigerian insurance industry landscape, said that the new bill, which may likely be assented to soon, will bring not only increased capital requirements but also enhanced regulatory guidance.
“A revitalised and well-capitalised financial services industry can significantly boost the economy by facilitating enhanced financial intermediation, wealth protection, and job creation. The proposed recapitalisation exercise presents significant opportunities for Nigerian insurance companies. With increased capital, insurers will be able to expand their risk appetite within the boundaries of their risk frameworks and regulatory guidance. This allows them to be able to take on more risk and potentially increase their retention ratios for certain lines of business that were previously ceded to foreign reinsurers, as there will be sufficient capital to absorb unexpected losses.
“This enhanced financial strength positions insurers to play a more significant role in supporting the Nigerian economy by providing broader coverage and contributing more effectively to national development. Insurance companies need to be ready for the many new regulations that will come into effect this year. This means having strong systems in place to keep accurate records and monitor their compliance with these regulations. Regulators will also be working to ensure the safety and stability of the insurance industry. They will likely work with the industry and consumers to find the best way forward, considering the current economic and regulatory environment,” stated Deloitte.
Pan African rating agency, Agusto & Co., also projected that the bill will be passed before the end of 2025 and that about N600bn would be pumped into the sector if and when the bill is signed into law.
Agusto & Co., in its 2025 Nigerian Insurance Industry Report, added that the bill would compel the National Insurance Commission to fast-track the transition to a risk-based capital regime (initiated over a decade ago).
The report highlighted, “This legislation would significantly impact the industry’s capitalisation based on the planned increase in the minimum capital requirement for the various business segments in the bill. We anticipate a circa N600bn capital injection by insurers to comply with the uptick in the minimum capital requirement and increase the underwriting capacity.
“While insurers would be allowed to recapitalise over a period, we anticipate an uptick in activities to shore up the capital base in FY 2025.”
The rating agency affirmed that the recapitalisation exercise would shape risk underwriting activities in the near term as insurers seek to generate adequate returns for shareholders.
Not only that, it projected increased adoption of innovation on the back of technology to drive insurance penetration and improved risk retention on the back of the enlarged capital base.
As the experts at Deloitte said, the bill presents both challenges and opportunities for the insurance sector. As seen in recent developments, players are already positioning themselves for the opportunities and strengthening to deal with the challenges.
The coming months could serve as a defining moment in the Nigerian insurance sector and have a wider impact on the economy, especially the drive to hit a $1tn economy by the end of the decade.
