Nigeria’s largest insurance provider, NICON Insurance has lost its operating licence and now operates under a Receiver Manager.
The National Insurance Commission (NAICOM), Nigeria’s insurance regulator, revoked NICON’s licence. The Federal Government controls NICON, which it established in 1969 under Decree 2.
NAICOM revoked NICON’s operational licence, RIC-049, over the company’s continued failure to meet regulatory requirements.
Following the revocation, NAICOM appointed Senior Advocate of Nigeria (SAN) Chukwuma-Machukwu Ume as NICON’s Receiver and Provisional Liquidator.
Following this, the Receiver Manager and Provisional Liquidator has issued a public notice urging policyholders, creditors, business partners, the federal and state governments, the FCT and land registries to direct all matters concerning NICON’s affairs, assets and business to his office to protect the company’s assets.
The notice warned that NICON Insurance, now in liquidation, would not honour any transactions, contracts, obligations or other activities carried out on its behalf without the Receiver and Liquidator’s approval.
The appointment of the Receiver and Provisional Liquidator effectively transferred control of NICON’s affairs to him. He will secure the company’s assets, determine its liabilities and oversee the winding-up process in accordance with the law.
NAICOM is taking action against NICON to enforce the increased capital requirements under the Nigerian Insurance Industry Reform Act (NIIRA) 2025.
The commission required insurance companies to meet the new minimum capital requirements within the stipulated recapitalisation period or risk losing their operating licences.
NAICOM revoked the company’s Insurance’s licence after it company failed to meet the requirements before the deadline.
Appointment of the Receiver Manager
Following the appointment of the Receiver Manager and Provisional Liquidator, the focus has shifted to securing control of NICON’s assets and documents, determining its actual liabilities and ensuring an orderly winding-up process.
The Receiver must also liaise with NAICOM on matters concerning the liquidation and provide regular updates on the progress of the process.
The development places the interests of creditors, policyholders and other stakeholders at the centre of the liquidation process, particularly when verifying and settling legitimate claims and liabilities.
Backstory…
In the insurance sector, appointing a Receiver/Provisional Liquidator represents a critical regulatory enforcement action, as it strips the existing management of operational control and assigns the firm’s affairs to an administrator tasked with safeguarding and liquidating assets to meet legal liabilities.
Furthermore, this intervention ensures strict oversight of all transactions conducted during the liquidation phase, preventing unauthorized transfers or disposition of the company’s holdings.
In an official statement, NAICOM underscored that the enforcement of recapitalization thresholds aims to bolster the industry’s overall financial resilience and ensure that only adequately capitalized institutions remain operational.
Meanwhile, the regulatory body recently announced that 43 reinsurance companies had successfully met the new minimum capital requirements at the end of the recapitalisation exercise.
