Senate Passes Bill to Rename NAICOM as Insurance Regulatory Commission

Reported by: Oahimire Omone Precious | Edited by: Oravbiere Osayomore Promise.

The Senate on Tuesday passed a bill seeking to rename the National Insurance Commission (NAICOM) as the Insurance Regulatory Commission (IRC), marking a significant reform of Nigeria's insurance regulatory framework. The bill, titled the National Insurance Regulatory Commission (Repeal and Enactment) Bill, 2026 (SB. 394), was passed after the upper chamber considered the report of its Committee on Banking, Insurance and Other Financial Institutions. The committee's chairman, Senator Adetokunbo Abiru, who represents Lagos East, presented the report before the Senate considered the bill clause by clause and passed it for third reading. Abiru sponsored the legislation alongside other members of the committee.

According to the Senate, the change to the new name is imperative against the backdrop that the former name is confusing given the history and make-up of the Nigerian Insurance Industry. Lawmakers explained that the change became necessary because the existing name no longer reflects the evolving structure of the insurance industry and has continued to create confusion regarding the commission's role. The proposed law is also designed to strengthen the regulator's independence, expand its supervisory powers and protect the commission and its officers from claims arising from the lawful discharge of their duties. The bill also provides legal protection for the Commission and its officials against adverse claims arising from the lawful execution of their statutory duties.

Presenting the committee's report, Senator Abiru traced the history of the commission, noting that it was established through the National Insurance Commission Decree of 1997 to regulate insurance companies, brokers and loss adjusters while ensuring compliance with industry standards. He said the commission was also empowered to protect policyholders, monitor the solvency of insurance institutions and enforce compliance across the industry. "Over the years, NAICOM has been instrumental in promoting compliance, enforcing standards and fostering the development of the insurance market," Abiru said. He, however, argued that the existing law had become outdated and could no longer adequately respond to developments in the sector. "Despite its significant contributions, the enabling law has become obsolete, failing to align with current realities and global best practices, and unable to keep pace with the evolving nature of the insurance industry," he added.

Explaining the objectives of the new legislation, Abiru said the bill seeks to establish the institutional independence of the commission and enable it to make regulatory decisions without undue interference. "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," he said. "The bill seeks to establish the independence of the commission and strengthen its regulatory powers, including the ability to make decisions without undue influence." The legislation would allow the regulator to issue guidelines, standards and directives on insurance-related matters. The bill also gives the commission wider authority to exchange information and collaborate with domestic and international regulatory bodies. Abiru said the regulator would be empowered to intervene in financially distressed insurance companies and oversee the orderly resolution of failing institutions. According to him, the provisions are intended to protect policyholders, preserve financial stability and reduce the risks posed by troubled insurers.

The bill also provides legal protection for the commission and its officers against adverse claims arising from the proper exercise of their statutory powers. Abiru said the proposed law introduced clearer qualification requirements for members of the commission's governing board. He noted that the insurance regulator played a major role in ensuring consumer protection, financial stability and industry development. "The bill introduces clear requirements for the expertise and suitability of board members that will ensure that only competent professionals with relevant experience and integrity are appointed to guide the commission's policies and regulatory framework," he said. Under the proposed legislation, board members are expected to possess relevant experience in areas including insurance, finance, law, risk management and corporate governance.

Following its passage, the legislation provides for the transition of NAICOM to the Insurance Regulatory Commission, subject to the completion of the lawmaking process and presidential assent. With the bill passing its third reading, the National Insurance Commission will be renamed the Insurance Regulatory Commission once the legislative process is completed. If signed into law, the legislation will replace the existing NAICOM Act of 1997. The bill is now awaiting presidential assent to become law.

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