The federal government has queried the National Insurance Commission (NAICOM) to provide a detailed response and legal justification regarding its alleged demand for a 1 per cent capital injection fee alongside additional processing and verification fees pursuant to Appendix 2 of the Commission’s Minimum Capital Requirement Guidelines, amounting to N305 million for Nigeria Insurance Limited (NICON), and N375 million for Nigeria Reinsurance Corporation (Nigeria Re), in the ongoing recapitalisation of the insurance industry.
In a well-publicised petition addressed to President Bola Ahmed Tinubu, NICON Insurance and Nigeria Reinsurance claimed that NAICOM had unlawfully demanded N500 million 1 per cent shareholders’ fund and an illegal transfer of N50 billion as well as the payment of N180 million recapitalisation fee to the Commission – the national insurance regulator.
The petitioners had called for full investigation by NAICOM’s supervising Federal Ministry of Finance or any appropriate government agency, urging the president to carry out a full-scale inquiry into the “fraudulent recapitalisation” exercise of the insurance industry and remove ‘Back Swans.’
However, reacting to the petition, the Minister of Finance and CordinatingMinister of the Economy, Mr. Taiwo Oyedele issued a query, which directed that pending the determination of the petition, NAICOM should suspend the enforcement of the contested processing fees, 1 per cent capital injection fee demands and full-capital escrow transfer directives against NICON Insurance Limited and Nigeria Reinsurance Corporation.
In the query issued on his behalf by the Permanent Secretary (Finance), Raymond Omachi, the minister directed the national insurance regulator to provide a detailed response and legal justification regarding the issues raised by the two insurance companies.
The minister’s query with reference number F/LEG/0608/2026/22 and dated August 6, 2026 was captioned, “Re-Illegal demand of N500 million Shareholders’ Funds (constituting an illegal fee of 1% of the capital injection), N180 million as a questionable capitalisation charge and the unconstitutional request to transfer more than 10% of the funds to the Central Bank of Nigeria in violation of Section 16(3) of the NIIRA 2025.”
It read: “The Ministry has received a petition dated 27th July, 2026 from NICON Insurance Limited (NICON) and Nigeria Reinsurance Corporation (Nig Re) regarding the ongoing recapitalisation exercise under the Nigerian Insurance Industry Reform Act (NIIRA), 2025.
“The petitioners have raised notable grievances against the Commission regarding:
“The assessment and demand for a 1% Capital Injection Fee alongside additional processing and verification fees pursuant to Appendix 2 of the Commission’s Minimum Capital Requirement Guidelines, amounting to N305 million for NICON and N375 million for Nig Re; and
“Directives requiring existing, operational insurance entities to transfer their entire capital injection funds into an escrow account at the Central Bank of Nigeria (CBN), as against the 10% statutory deposit requirement prescribed under Section 16(3) of NIIRA 2025.
“The petitioners contend that they have complied with the statutory deadline of 31st July 2026 by injecting N20 billion and N30 billion respectively into Mudaraba Term Deposit accounts with Lotus Bank Limited exceeding their adjusted requirements of N16 billion and N28 billion. They also submit that they have deposited N2.5 billion and N3.5 billion with the CBN pursuant to Section 16(3) of NIIRA 2025 and had made initial fee payments of N80 million and N75 million.
“In view of the above, you are requested to provide a detailed response and legal justification regarding the issues raised.
“Pending the determination of the petition, the Commission should suspend the enforcement of the contested processing fees, 1% capital injection fee demands and full-capital escrow transfer directives against NICON Insurance Limited and Nigeria Reinsurance Corporation.”
Ndubuisi Francis and James Emejo
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