The Senate has passed a landmark bill to repeal the National Insurance Commission (NAICOM) Act and replace it with a new legal framework that will see the regulator renamed the Insurance Regulatory Commission (IRC), in a move aimed at strengthening oversight of Nigeria’s insurance industry and aligning the sector with global regulatory standards.

The legislation, passed on Tuesday after its third reading, seeks to grant the Commission greater operational independence, stronger enforcement powers and wider authority to collaborate with domestic and international regulators, while also providing legal protection for the Commission and its officers in the discharge of their statutory responsibilities.

The bill 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), presented by the committee chairman, Senator Mukhail Adetokunbo Abiru (APC, Lagos East).
Abiru explained that the proposed name change became necessary because the current designation has become outdated and no longer reflects the evolving regulatory landscape of Nigeria’s insurance industry.

He noted that the existing National Insurance Commission Act of 1997 has become obsolete and is 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 establish the independence of the Commission, enhance its regulatory authority and empower it to take decisions without undue external influence.

The bill also empowers the Commission to exchange information with local and international supervisory authorities, issue regulations, guidelines and directives to stakeholders, and intervene more effectively in distressed insurance institutions to safeguard policyholders and preserve financial system stability.

Abiru told lawmakers that the Commission would be vested with stronger resolution powers to facilitate the orderly management or winding down of failing insurers in line with global regulatory standards.

He recalled that NAICOM was established by decree in 1997 to regulate insurance companies, brokers and loss adjusters, ensure compliance with industry rules, protect policyholders and monitor the financial health of insurance operators.

While acknowledging the Commission’s contributions to the development of the industry over the years, he argued that the legal framework governing its operations had failed to keep pace with emerging realities, creating regulatory gaps that require urgent legislative intervention.

The bill further 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.

Industry stakeholders are expected to welcome the reform as one of the most significant institutional changes in Nigeria’s insurance sector in nearly three decades. Analysts believe that the enhanced powers and operational autonomy proposed under the new law could improve regulatory efficiency, deepen consumer protection, strengthen market discipline and boost investor confidence.

The legislation now awaits concurrence by the House of Representatives, where necessary, and presidential assent before the transition from the by National Insurance Commission (NAICOM) to the Insurance Regulatory Commission (IRC) becomes legally effective.