Insurance companies in Nigeria are awaiting access to about ₦300 billion raised during the industry’s recently concluded recapitalisation exercise, as the Central Bank of Nigeria (CBN) continues verifying the sources of the funds.
The money remains in escrow accounts following concerns that some investments may have originated from illicit sources. The CBN subsequently introduced stricter verification procedures, which have delayed the release of the funds to the affected companies.
Although the National Insurance Commission (NAICOM) has approved the release of the money, insurance firms are still working to meet the central bank’s requirements.
Speaking during a virtual briefing on the outcome of the Insurers Committee meeting, Nigerian Insurers Association (NIA) Chairman Ebelechukwu Nwachukwu said the regulator had completed its part of the process, while companies were addressing the CBN’s conditions.
The affected insurers are hoping to regain access to the funds before the end of October.
₦300bn Raised by 24 Insurance Companies
Twenty-four insurance companies collectively raised approximately ₦300 billion in fresh capital during the recapitalisation exercise. The amount was added to more than ₦700 billion in existing industry capital, bringing total sector capital to about ₦1.079 trillion after recapitalisation.
The Nigerian Insurance Industry Reform Act (NIIRA) 2025 required participating insurers and reinsurers to keep their recapitalised funds in escrow accounts with the CBN following the exercise, which ended on July 31, 2026.
Of the 50 insurance and reinsurance companies that met the recapitalisation requirements, 24 raised additional capital, while 26 already had capital above the new minimum thresholds.
The exercise was designed to strengthen insurers’ financial capacity and improve their ability to cover larger risks and meet their obligations to policyholders.
New Capital Release Delayed by CBN Checks
The delay has affected the plans of insurance companies that expected to deploy the newly raised funds during the third quarter of 2026.
The firms had intended to use the additional capital to improve their financial performance and reward investors with stronger returns for supporting the recapitalisation process.
However, the funds remain inaccessible while the CBN completes its verification procedures.
The central bank’s checks are intended to establish that the investments came from legitimate sources and meet applicable regulatory requirements. The delays mean affected insurers must continue working through the process before the funds can be returned to their original accounts.
New Minimum Capital Requirements for Insurers
The recapitalisation exercise introduced higher minimum capital thresholds for insurance companies and reinsurers.
Under the new requirements, life insurance companies were required to increase their minimum capital from ₦2 billion to ₦10 billion. Non-life insurers had to raise theirs from ₦3 billion to ₦15 billion, while reinsurers faced an increase from ₦10 billion to ₦35 billion.
NAICOM Commissioner for Insurance and Chief Executive Officer Olusegun Omosehin previously disclosed that total capital in the insurance industry had risen to approximately ₦1.079 trillion following the exercise, compared with around ₦700 billion before recapitalisation.
The regulator expects the stronger capital base to improve the sector’s financial resilience and capacity to support businesses and individuals.
What the Delay Means for the Insurance Industry
The release of the ₦300 billion remains an important next step for the affected companies as they move from recapitalisation towards expanding their operations.
Once the funds become available, insurers are expected to have greater capacity to underwrite risks, strengthen their financial positions and develop new products.
However, the verification process highlights the importance of ensuring that capital raised by financial institutions meets regulatory and anti-money-laundering requirements.
For the affected firms, the immediate priority is to satisfy the CBN’s criteria and regain access to the money so they can proceed with their post-recapitalisation plans.
