BY FRONTLINE REPORTERS

Insurance companies are struggling to access about N300 billion in fresh capital raised under the recently concluded recapitalisation programme, as the funds remain trapped in an escrow account with the Central Bank of Nigeria (CBN) pending verification to rule out illicit sources.

Industry sources said the apex bank had tightened its capital verification procedures over suspicions that some investments might have originated from questionable sources, making it difficult for several insurance firms to satisfy the requirements for accessing the funds.

Although the National Insurance Commission (NAICOM) has reportedly given the necessary approval for the release of the funds, the affected companies are still working to meet the CBN’s verification criteria.

Speaking during a virtual press briefing on the outcome of the Insurers Committee meeting, the Chairman of the Nigerian Insurers Association (NIA), Mrs Ebelechukwu Nwachukwu, said NAICOM had completed its part of the process, while operators were working to satisfy the apex bank’s requirements to access the funds before the end of October.

The insurers had planned to deploy the fresh capital in the third quarter of 2026 to strengthen their financial performance and improve returns to shareholders through dividend payments in recognition of their support for the recapitalisation exercise.

Available figures indicate that 24 insurance companies raised a combined N300 billion in fresh capital during the exercise. Added to the industry’s existing capital of more than N700 billion, the funds brought total industry capital to N1.079 trillion after recapitalisation.

The Nigerian Insurance Industry Reform Act (NIIRA) 2025 required participating insurance companies and reinsurers to keep their recapitalised funds in an escrow account with the CBN. The recapitalisation exercise ended on July 31, 2026.

Of the 50 insurance companies that met the recapitalisation requirements, 24 raised fresh capital, while the remaining 26 had already exceeded the prescribed minimum capital thresholds.

Under NIIRA 2025, life insurance companies were required to increase their minimum capital from N2 billion to N10 billion, while non-life insurers were mandated to raise theirs from N3 billion to N15 billion. Reinsurance companies were required to increase their minimum capital from N10 billion to N35 billion.

The Commissioner for Insurance and Chief Executive Officer of NAICOM, Mr Olusegun Omosehin, had earlier disclosed that the industry’s total capital had risen to N1.079 trillion from approximately N700 billion before the exercise.

Omosehin said the commission was working towards allowing operators to access their recapitalisation funds, adding that NAICOM would monitor the deployment of the money to ensure it served its intended purpose and was neither mismanaged nor diverted to unrelated investments.