ABUJA, Nigeria — The Senate has passed a landmark bill seeking to repeal the National Insurance Commission (NAICOM) Act and replace it with a new legal framework that will rename the regulator the Insurance Regulatory Commission (IRC).
The bill, which was passed on Tuesday after its third reading, seeks to grant the Commission greater enforcement powers and wider authority to collaborate with domestic and international regulatory bodies.
It also provides legal protection for the Commission and its officers in the discharge of their statutory responsibilities.
The legislation followed the presentation and adoption of the report of the Senate Committee on Banking, Insurance and Other Financial Institutions on the National Insurance Regulatory Commission (Repeal and Re-enactment) Bill, 2026 (SB. 394).
The report was presented by the committee chairman, Senator Mukhail Adetokunbo Abiru (APC, Lagos East).
Senate Seeks Greater Independence for Insurance Regulator
Abiru explained that the proposed change of name had become necessary because the current designation was outdated and no longer reflected the evolving regulatory landscape of Nigeria's insurance industry.
He said the existing National Insurance Commission Act of 1997 had become obsolete and was no longer sufficient to address the complexities of the modern insurance market or meet international best practices.
According to him, the proposed legislation is designed to guarantee the independence of the Commission, strengthen its regulatory authority and enable it to take decisions without undue external influence.
The bill would also empower the Commission to exchange information with local and international supervisory authorities, issue regulations, guidelines and directives to industry stakeholders, and intervene more effectively in distressed insurance institutions.
These measures, the Senate committee chairman said, are intended to safeguard policyholders and preserve the stability of the financial system.
Bill Grants Commission Stronger Resolution Powers
Under the proposed law, the Commission would be vested with stronger resolution powers to facilitate the orderly management or winding down of failing insurance companies in line with global regulatory standards.
Abiru recalled that NAICOM was established by decree in 1997 to regulate insurance companies, brokers and loss adjusters, ensure compliance with industry regulations, protect policyholders and monitor the financial health of insurance operators.
While acknowledging the Commission's contributions to the development of Nigeria's insurance industry over the years, he argued that the legal framework governing its operations had failed to keep pace with emerging realities.
He said the outdated framework had created regulatory gaps that required urgent legislative intervention.
The bill also provides statutory protection for the Commission and its officials against legal actions arising from decisions taken in good faith while exercising powers conferred by the law.
Reform Expected to Boost Insurance Sector
The proposed reform is expected to be welcomed by industry stakeholders as one of the most significant institutional changes in Nigeria's insurance sector in nearly three decades.
The enhanced regulatory powers and operational autonomy proposed under the new framework could improve regulatory efficiency, deepen consumer protection, strengthen market discipline and boost investor confidence in the industry.
The legislation will now require concurrence by the House of Representatives, where necessary, and presidential assent before the proposed transition from the National Insurance Commission (NAICOM) to the Insurance Regulatory Commission (IRC) becomes legally effective.
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