• President Bola Tinubu signs NIIRA 2025, replacing the 2003 insurance law.

• The law raises capital requirements, enforces mandatory policies, and pushes digital access.

• Nigeria’s insurance market grew 56% in 2024 but remains behind other major African economies.

Nigerian President Bola Ahmed Tinubu on August 5 signed into law the 2025 Nigerian Insurance Reform Act (NIIRA 2025), a measure aimed at overhauling the country’s insurance sector. The new legislation repeals several existing insurance laws, including the 2003 Insurance Act.

The bill was passed by the Senate in December 2024 and by the House of Representatives in March 2025. It sets out a comprehensive framework for regulating and supervising all insurance and reinsurance companies operating in Nigeria. The law aims to strengthen the financial stability of insurers and increase the sector’s contribution to the national economy.

Tougher rules and wider access

Key reforms include higher minimum capital requirements for insurance companies to ensure their financial strength; mandatory coverage for certain policies, such as motor vehicles and public buildings, to improve consumer protection; and the digitalization of insurance services to give customers easier access, including via mobile phones.

The law also introduces penalties for late claim payments to encourage faster settlements, establishes guarantee funds to protect policyholders in case of company insolvency, and expands participation in regional mechanisms such as the ECOWAS Brown Card, which provides cross-border insurance coverage in West Africa.

The National Insurance Commission (NAICOM) will oversee the implementation of the reforms. NAICOM said the new framework will make the sector more competitive regionally and internationally while attracting more investment. “The new legislation marks a significant milestone in the country’s efforts to reinvigorate the insurance industry, over two decades after the enactment of the Insurance Act 2003,” the commission said.

A growing but underdeveloped market

Nigeria’s insurance sector remains underdeveloped compared to other major African economies. In 2024, insurance companies recorded revenue of 1.562 trillion nairas, about $1 billion, according to data presented on June 26, 2025, by Kunle Ahmed, president of the Nigerian Insurers Association (NIA), at the group’s 54th annual general meeting. This was a 56% increase from 2023.

Non-life premiums totaled 1.092 trillion nairas (about $705.5 million) compared with 470 billion nairas ($303.7 million) for life insurance. Total claims paid by all insurers amounted to 622 billion nairas, or $401.8 million.

Nigeria accounted for 2.1% of Africa’s total insurance premiums in 2023, according to the African Insurance Organization’s 2024 report. South Africa, Morocco, Egypt, and Kenya together accounted for 84.8% of the continent’s total.

By tightening regulations and modernizing the industry, Nigeria aims to raise insurance’s share of GDP and narrow the gap with Africa’s market leaders.