Senate Passes Bill Renaming NAICOM as Insurance Regulatory Commission

• Lawmakers pass legislation replacing the National Insurance Commission (NAICOM) with the Insurance Regulatory Commission (IRC) as part of efforts to modernise Nigeria’s insurance regulatory architecture

• The bill strengthens the autonomy of the regulator, empowers it to issue binding regulations and directives, collaborate with domestic and international regulators, and exercise stronger supervisory authority over insurance operators.

• The legislation equips the commission with enhanced intervention and resolution powers to address distressed insurance companies, safeguard policyholders’ interests, and ensure the orderly resolution of failing insurers.

• The proposed law sets higher professional and integrity requirements for members of the commission’s governing board while protecting the commission and its officers from liability arising from actions taken in the lawful discharge of their statutory duties.

July 21, () — The Senate on Tuesday passed a landmark bill seeking to overhaul Nigeria’s insurance regulatory framework by renaming the National Insurance Commission (NAICOM) as the Insurance Regulatory Commission (IRC) and significantly expanding the powers, independence, and responsibilities of the country’s insurance regulator.

The legislation, titled the Insurance Regulatory Commission (Establishment) Bill, 2026, was passed after the Senate considered and adopted the report of its Committee on Banking, Insurance and Other Financial Institutions on the National Insurance Regulatory Commission (Repeal and Re-enactment) Bill, 2026 (SB.394).

The report was presented by the Chairman of the Committee, Senator Mukhail Adetokunbo Abiru (APC, Lagos East), who sponsored the bill alongside other members of the committee.

With the passage of the bill at its third reading, lawmakers approved the transition of the National Insurance Commission to the Insurance Regulatory Commission, subject to concurrence by the House of Representatives and presidential assent.

According to the lawmakers, the change of name became necessary because the existing designation no longer adequately reflects the evolving responsibilities of the regulator and has become confusing in view of the history and current structure of Nigeria’s insurance industry.

Presenting the committee’s report, Senator Abiru recalled that the National Insurance Commission was established under the National Insurance Commission Decree of 1997 to regulate insurance companies, brokers, and loss adjusters, ensure compliance with industry regulations, protect policyholders, and promote the orderly development of the insurance market.

He acknowledged that the Commission had played a critical role in improving compliance and strengthening the insurance industry over the years but argued that the law establishing it has become obsolete.

According to him, the 1997 Act no longer addresses the realities of today’s insurance market, emerging financial risks, technological innovations, and international regulatory standards.

He said the outdated legislation has created significant gaps that have limited the regulator’s effectiveness and necessitated urgent legislative intervention.

“The current National Insurance Commission Act 1997 is outdated and does not adequately address the emerging economic growth, needs, and development of the insurance business,” Abiru told the Senate.

Enhanced Independence and Stronger Regulatory Authority

One of the major features of the legislation is the strengthening of the Commission’s institutional independence.

The bill empowers the Insurance Regulatory Commission to perform its statutory functions without undue interference while expanding its authority to formulate regulations, guidelines, standards, and directives for the insurance industry.

It also authorises the regulator to exchange information and cooperate with both local and international regulatory and supervisory institutions in line with global best practices for financial sector oversight.

The Senate noted that the enhanced powers would enable the Commission to respond more effectively to emerging risks in Nigeria’s insurance market while improving regulatory efficiency and investor confidence.

The proposed law further grants the Commission strengthened intervention and resolution powers to deal with financially distressed insurance institutions.

Under the new framework, the regulator will be empowered to intervene early in troubled insurance firms, protect policyholders, maintain financial system stability, and facilitate the orderly resolution of failing insurers where necessary.

Lawmakers said the provisions are intended to reduce systemic risks within the insurance industry while enhancing public confidence in insurance products and institutions.

The bill also provides legal protection for the Commission and its officials against adverse claims arising from actions taken in the lawful execution of their regulatory responsibilities.

Competence-Based Board Appointments

The legislation introduces stricter requirements for appointments to the Commission’s Governing Board.

According to Senator Abiru, the reforms are designed to ensure that only individuals with proven expertise in insurance, finance, risk management, law, and corporate governance are appointed to oversee the affairs of the Commission.

He said the measure would improve the quality of policy formulation, strengthen institutional governance, and enhance regulatory oversight across the insurance sector.

“The National Insurance Commission plays a critical role in regulating and developing Nigeria’s insurance sector, ensuring financial stability, consumer protection, and industry growth,” Abiru said.

“To effectively achieve these objectives, it is essential that its Governing Board comprises individuals with the requisite expertise in insurance, risk management, finance, law, and corporate governance.”

He added that the bill establishes clear standards of competence, experience, and integrity for board members to ensure effective leadership of the Commission.