The Executive Director (Technical), Continental Reinsurance Plc, Chukwuemeka Akwiwu, has urged insurance companies to adopt good governance practices to enable judicious use of the fresh capital that industry players are raising.
Akwiwu made this call at the annual retreat of the Risk, Audit, and Compliance Committee, a technical body under the Nigerian Insurers Association, held in Abeokuta, Ogun State.
The Nigerian Insurance Industry Reform Act 2025, signed into law, has mandated new capital thresholds for insurance players. The Act mandates new minimum capital requirements, including the crucial shift to a risk-based capital framework. This means insurers will now calculate their capital based on the specific risks they face, encompassing insurance, market, credit, and operational risks, moving away from a one-size-fits-all approach previously in place. For instance, the proposed new minimum for non-life insurance business rose to N25bn (or RBC as determined by NAICOM) from N10bn, life insurance to N15bn from N8bn, and reinsurance to N35bn from N20bn.
Speaking on the theme of the retreat, ‘Insurance Industry Recapitalisation: Strengthening Governance Activities for Maximum Benefits’, Akwiwu emphasised that while new capital provides much-needed strength to insurers’ balance sheets, it is governance that ensures capital is deployed wisely, risk is underwritten responsibly, and companies are positioned for sustainable growth.
“With recapitalisation, we now have the capacity to underwrite more and take on larger risks. But that comes with the responsibility to ensure we are taking on the right risks, with proper exposure limits and necessary protections in place. Governance and control must guide this process,” Akwiwu noted.
He highlighted that capital, while necessary, is never permanent unless it is well managed, saying, “Capital is fleeting; it comes and goes. But it is always willing to stay where strong governance structures are in place. Governance is the multiplier of capital. It doesn’t just preserve capital; it enhances its impact.”
Akwiwu, while welcoming the increased capital requirements, called for company boards and leadership to go beyond compliance and embed a culture of risk management and strategic oversight at every level of operation.
“This is not business as usual. Every individual in the value chain must take ownership of the process and ensure that decisions are not made first and then justified later. Compliance must come first, not as a reaction, but as a guiding principle,” he emphasised.
He also urged insurers to revisit the composition of their boards, perform skills gap analyses, and ensure that board members are chosen based on merit and value addition, not personal relationships.
“Gone are the days of sitting on boards because your friend owns the company. You must bring value, expertise, and accountability,” he said.
Akwiwu expressed optimism about the future of Nigeria’s insurance industry and its role in contributing to the country’s $1tn economy.
“Stronger capital, aligned with stronger governance, will not only stabilise our companies but also increase public trust in our products and services, creating a cycle of growth and deeper penetration,” he said.
