The insurance law changed in 2025, and most guides have not caught up

The Nigeria Insurance Industry Reform Act, shortened to NIIRA, was signed in 2025 and it did not amend the old law. It repealed it. The Insurance Act 2003 is gone, along with four other statutes, and the compulsory insurance list went from six classes to eleven. If you are reading a guide that cites the 2003 Act, you are reading about a law that no longer exists.

Five statutes became one

NIIRA repealed and absorbed the Insurance Act 2003, the Marine Insurance Act, the Motor Vehicles Third Party Insurance Act, the National Insurance Corporation of Nigeria Act and the Nigeria Reinsurance Corporation Act. Everything now sits in a single enactment, and NAICOM was given room to fill in detail through regulation rather than requiring a fresh Act every time a figure needs moving.

That last part matters more than it sounds. Several of the numbers below can be raised by the Commission without going back to the National Assembly, so a figure that is current today is not fixed forever.

The compulsory list nearly doubled

The old Act is usually summarised as six compulsory classes. NIIRA names eleven, and several of them will be new to businesses that thought they were compliant.

• Group life for employers with five or more staff, section 68
• Builders liability on buildings under construction of more than one floor, section 75
• Occupiers liability on buildings the public can enter, section 76
• Government assets and employees, section 77
• Petroleum and gas stations, section 78
• Healthcare professional indemnity, section 80
• Aviation ancillary services, section 81
• Marine cargo on imported goods, section 82
• Third party motor, section 84
• Credit life on facilities of 10 million naira and above, section 91
• Container insurance, section 203

Container insurance and credit life are the two that catch people, because neither existed as a standalone compulsory class before. If you move goods in containers, the container is a separate requirement from the cargo inside it.

Third party motor has to pay more

Section 87 sets minimum payouts on a third party motor policy: 3 million naira for third party property damage, 100,000 naira for out-patient medical expenses and 250,000 naira for in-patient treatment. The Act also brings passengers in commercial vehicles into compulsory cover, requires damage to road infrastructure to be included, and ends the exemption that let government vehicles run without third party insurance.

If you last looked at your motor schedule some years ago, the property damage floor is the line to check. It sits a long way above where the old Act left it.

Group life is now backed by a per-head penalty

Section 68 requires group life at a minimum of three times an employee's annual total emolument, and going without it costs 250,000 naira per employee. That is a penalty that scales with your headcount rather than a flat fine, which is a deliberate change of posture. A fifty person business is looking at 12.5 million naira of exposure for a policy that would have cost a fraction of it.

Placing Nigerian risk abroad got harder

The Act shuts a loophole that had been open for years. Any Nigerian person or company that arranges or underwrites insurance for a Nigerian risk abroad is now treated as carrying on insurance business in Nigeria, which puts them squarely under NAICOM. Foreign insurers without a real presence in their own home country, or outside a supervised financial group, are barred from operating here at all.

Combined with section 82 on imported goods, the direction of travel is clear enough. Nigerian risk is expected to be insured by insurers Nigerian regulators can reach when a claim is disputed.

Insurers themselves have work to do

• Composite insurers must split into life or non-life, with five years to restructure
• Annuity becomes its own class under life business
• Existing insurers have twelve months to meet revised minimum capital requirements
• NAICOM can classify insurance business and publish additional classes in the Federal Government Gazette
• Delay in settling a claim carries a penalty of 500,000 naira

The recapitalisation is the part that should matter most to anyone buying cover. Higher capital requirements push thinly funded underwriters out of the market, and a thinly funded underwriter is precisely the one that finds reasons not to pay.

What to actually do about it

• Run your business against the eleven classes and find the ones you assumed did not apply
• Check the sums insured on any motor policy written before the new minimums
• If you import, confirm your marine cargo cover sits with a Nigerian registered insurer and ask whether your containers are separately insured
• If you employ five or more people, confirm the group life benefit is genuinely three times annual total emolument and not an older, lower figure

This is a general summary and not legal advice. NIIRA leaves a good deal to regulation, so figures and thresholds can move without the Act changing. Confirm what applies to your business before relying on any of it.