NAICOM Charges NIA to Rebuild Public Trust in Insurance Sector

NAICOM to NIA: Trust is the New Currency—Rebuild It or Risk Irrelevance

The insurance sector is at a defining moment, with the regulator issuing a clear and urgent call for a complete overhaul of public perception.

LAGOS, NIGERIA – In a powerful address that signaled a new era for the Nigerian insurance industry, the Commissioner for Insurance and CEO of the National Insurance Commission (NAICOM), Mr. Olusegun Ayo Omosehin, has issued a stark challenge to the Nigerian Insurers Association (NIA): the time for talk is over; it is time to rebuild public trust.

Speaking at the historic investiture of Mrs. Ebelechukwu Nwachukwu as the 27th and first female Chairman of the NIA in Lagos, Omosehin declared that the industry’s greatest deficit is not financial, but reputational . “Our biggest deficit is not capital. It is trust,” he stated, setting a serious tone for the gathering of the industry’s top executives .

This charge comes at an inflection point, as the sector grapples with the implementation of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 and races toward the July 31, 2026 recapitalisation deadline . While these are crucial steps toward building stronger institutions, the regulator made it clear that legal frameworks and capital alone cannot build the industry's future.

Trust Deficit: The Industry’s Biggest Hurdle

For decades, the Nigerian insurance sector has been plagued by a poor public image, largely due to the perception—and often the reality—of arduous claims processes and delayed payments . This has resulted in a staggeringly low penetration rate of less than 1% of GDP, leaving over 100 million Nigerians without insurance coverage .

Omosehin emphasized that the industry now has the legal and regulatory framework for sustainable growth, but requires strong leadership to translate these reforms into tangible benefits for the public . “The foundations have been laid. But foundations do not build houses. People do. Institutions do. Leadership does,” he asserted .

A New Leadership’s A.C.E Agenda

In response to this challenge, the newly inaugurated Chairman, Mrs. Ebelechukwu Nwachukwu, who is also the Managing Director of Rex Insurance Limited, unveiled her administration’s strategic "A.C.E Agenda." This three-pronged framework is designed to tackle the industry's deepest challenges :

• Awareness: The industry will launch coordinated campaigns to demystify insurance, replacing complex jargon with clear communication to rebuild public understanding and trust .

• Capacity Building: A dedicated push for professional development, actuarial discipline, and enhanced digital capabilities will ensure the industry has the talent to deliver on its promises .

• Enforcement: The NIA will work to uphold high professional standards and ensure strict compliance with regulations, including the enforcement of the six classes of compulsory insurance .

"Let us replace jargon with clarity. Let us replace fear with proof. When we pay claims quickly and fairly, we do not just satisfy a customer. Every paid claim is a testimony. Every testimony grows our market," said Nwachukwu .

Three Pillars of the New Mandate

Omosehin outlined three critical areas for the NIA to focus on immediately:

1. Leadership in Trust: Making Claims Excellence a Culture

The regulator insisted that prompt and fair claims settlement is the single most effective marketing tool for the industry . Insurers are being called upon to publish their claims records and compete on the basis of service, not just premium . NAICOM has reinforced this by recently directing all insurers to settle all outstanding discharged claims before the recapitalisation deadline, warning that non-compliance could halt their re-licensing .

2. Leadership in Enforcement: Boosting Compliance

The Commissioner lamented that compliance with Nigeria’s six compulsory insurance policies remains below 30% . The NIA has been tasked with working closely with state governments and law enforcement agencies like the Federal Road Safety Corps (FRSC) and the Nigeria Police Force to ensure that these policies are enforced, thereby protecting lives, property, and growing the market .

3. Leadership in Innovation: Deepening Penetration

To reach the vast uninsured population, the industry must embrace innovation. This includes scaling digital channels, promoting microinsurance and Takaful (Islamic insurance), and developing parametric products to cover agricultural and climate risks . "Our Regulatory Sandbox is open. Digital channels are waiting," Omosehin affirmed, urging operators to explore these opportunities .

Looking Ahead

As the industry stands at this "defining inflection point," the path forward is clear . The transformation of the insurance sector is no longer just about regulatory compliance; it is about a fundamental shift in how insurers engage with the Nigerian people. The new NIA leadership, backed by a firm regulatory hand, is being positioned to not only rebuild trust but to also expand the market to the over 100 million Nigerians who have never owned a policy .

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"Grow penetration, not just premium. Take insurance to the 100 million Nigerians who have never seen a policy document," Omosehin concluded, setting a visionary, if challenging, agenda for the future of the industry .

This report was developed based on regulatory announcements and industry events. Details regarding specific policies and financial targets are as outlined by NAICOM and the NIA.