A new development has surfaced in the insurance industry’s ongoing recapitalisation drive, as some operators are opting to surrender one of their licences in order to comply with the new minimum capital requirements (MCR).
In several cases, companies are also reorganising their portfolios by exiting high-risk segments, allowing them to better align their capital base with their risk exposure under the post-recapitalisation framework.
The Nigerian Insurance Industry Reform Act (NIIRA), the new law driving the insurance sector recapitalization, has put operators on their toes to match risks with capital, and this is causing jitters in the market.
At the last count, two composite insurance companies have put their life insurance licenses for sale to enable them recapitalise, and concentrate on their general business portfolio.
A top-level management in one of the companies who pleaded anonymity said: “Our core investor wants us to concentrate on our general business, so we are letting go our life insurance licence.”
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He added that arrangements are underway to transfer the company’s riskier annuity assets to another insurer, noting that the transaction has received regulatory approval from both the National Insurance Commission (NAICOM) and the National Pension Commission (PenCom).
Meanwhile, just this week, Cornerstone Insurance Plc announced the acquisition of the annuity portfolio of Lasaco Assurance Plc, a composite insurer largely owned by the Lagos State Government.
According to Cornerstone, the annuity transfer was a strategic business decision by Lasaco Assurance.
Stephen Alangbo, group-managing director/CEO Cornerstone Insurance Plc, stated that Lasaco identified Cornerstone as a reliable partner following a careful market assessment, in a strategic business plan to offload its annuity portfolio.
“Our reputation, financial strength, and customer service give retirees confidence that Cornerstone will always be there,” he added.
This is as Cornerstone has also taken over the annuity business of Niger Insurance Plc, currently under liquidation following revocation of its license some five years ago.
The acquisitions are part of Cornerstone’s broader strategy to expand its footprint in both life insurance and annuity business, while ensuring continuity for policyholders, the CEO said.
The company also signalled readiness to acquire additional portfolios if the opportunity calls, demonstrating confidence in its financial position and operational capabilities.
Late in 2025, Leadway Assurance took over the annuity portfolio of African Alliance Insurance Plc that was insolvent and unable to meet claims’ obligations.
The primary objective of the exercise, Leadway said, was to safeguard the immediate welfare of retirees and ensure that every individual’s benefits are secured for efficient and timely payment.
At the flag off annuitant’s verification exercise in January, Leadway said the verification exercise was a direct response to the regulatory measures introduced by NAICOM to protect policyholders and strengthen confidence in the sector.
Olufunmilayo Amanwa, executive director, Technical & Operations at Leadway Assurance Company Limited, who spoke about the development, stated that by participating in this exercise, retirees under the African Alliance portfolio can transition seamlessly to the Leadway brand, ensuring the continuity of their payments without disruption.
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“The verification of annuitants is more than just a process; it demonstrates our commitment to retirees. We want to ensure that their years of service and contributions are rewarded with financial certainty and dignity.
“The validation exercise establishes a solid foundation for timely benefit payments and maintaining the trust placed in us.”
This transfer follows NAICOM’s intervention in appointing an interim management team as part of the process in settling outstanding annuity payments.
The successful transfer to Leadway not only secures the immediate welfare of annuitants but also represents a broader step toward strengthening Nigeria’s insurance ecosystem, Amanwa stated.
NIIRA 2025, signed by Bola Ahmed Tinubu, Nigeria’s president, on August 5, 2025, introduced higher MCR for insurance and reinsurance companies, giving them till July 31, 2026 as deadline for compliance.
In the new requirement, life companies are required to shore up their MCR to N10 billion, general companies, N15 billion; composie companies, N25 billion; and reinsurance companies N35billion.
