The Central Bank of Nigeria is holding approximately N300 billion in capital raised by insurance companies during a recent recapitalisation programme while it checks whether any of the funds came from illicit sources. The 24 firms that raised this fresh capital during the exercise, which ended on 31 July 2026, are unable to access the money, which remains in an escrow account at the CBN pending verification. The National Insurance Commission, NAICOM, has already approved the release of the funds, but insurance operators are working through the CBN's verification criteria to obtain access.
The delay has disrupted plans that the insurance sector had made months ago. Industry leaders said they had intended to deploy the newly raised capital in the third quarter of this year to strengthen financial performance in 2026 and distribute dividends to investors who backed the recapitalisation drive. The chairman of the Nigeria Insurers Association, Mrs Ebelechukwu Nwachukwu, told journalists during a virtual briefing that operators expect to complete the CBN's requirements and gain access to the funds by the end of this month.
The recapitalisation programme expanded the insurance industry's total capital base substantially. Of the 50 firms that qualified for the exercise, 24 raised new capital while 26 had already exceeded the minimum benchmarks set by the Nigerian Insurance Industry Reform Act of 2025. The fresh capital of N300 billion, combined with over N700 billion in existing capital, has brought total industry capital to N1.079 trillion, according to NAICOM's commissioner for insurance and chief executive, Olusegun Omosehin. The NIIRA mandated life underwriters to raise capital from N2 billion to N10 billion, non-life insurers from N3 billion to N15 billion and reinsurers from N10 billion to N35 billion.
NAICOM has committed to monitoring how the released capital is deployed to ensure it achieves its intended purpose and is not misallocated. The stricter verification regime reflects concerns about the sources of some investments flowing into the recapitalised firms. Once access is granted, the funds will be critical to boosting the financial strength of Nigeria's insurance sector going forward.