Former Commissioner for Insurance and Chief Executive Officer of the National Insurance Commission (NAICOM), Alhaji Mohamed Kari, has urged the Federal Government to uphold regulatory discipline and ensure a level playing field in Nigeria’s insurance industry, warning that political interference in regulatory enforcement could undermine investor confidence and financial stability.
Kari, who is also a former Managing Director of Nigeria Reinsurance Corporation and NICON Insurance, made the call in an open letter addressed to the Minister of Finance and Coordinating Minister of the Economy, urging the Ministry to resist attempts by operators to secure political concessions against regulatory requirements.
He argued that the strength of Nigeria’s economy depends, among other things, on transparent and predictable financial regulation, insisting that statutory requirements must apply equally to all insurance operators irrespective of their ownership, history or political influence.
According to him, the current enforcement of recapitalisation and other regulatory requirements by NAICOM provides an opportunity to strengthen the financial foundation of the insurance industry and protect policyholders.
Kari expressed concern over what he described as repeated attempts by NICON and Nigeria Re to seek intervention from the Ministry of Finance to circumvent regulatory requirements.
He said such intervention would create an uneven competitive environment in which companies that complied with the law would be disadvantaged while non-compliant operators receive preferential treatment.
“Where compliance is treated as mandatory for 90 per cent of the market but optional for a selective few, the concept of statutory regulation collapses into favouritism,” he stated.
The former insurance regulator noted that more than 90 per cent of insurance operators had complied with the statutory process for raising fresh capital, meeting reserve requirements, undergoing verification and paying regulatory fees.
He therefore questioned why some operators should be allowed to seek special exemptions after other companies had invested significant resources to meet the same requirements.
Kari traced the historical importance of NICON and Nigeria Re to their establishment by the Federal Government in 1969 and 1977 respectively, describing the institutions as former pillars of Nigeria’s insurance industry.
He said the two organisations played critical roles in developing domestic insurance capacity, retaining premium capital within the country, underwriting public assets and training generations of insurance professionals.
However, he argued that the institutions had subsequently suffered years of governance challenges, financial difficulties, declining market share and operational shrinkage, resulting in interventions by NAICOM and the Asset Management Corporation of Nigeria (AMCON).
Kari maintained that their historical importance should not be used as a basis for exempting them from contemporary regulatory standards.
He also questioned the rationale for political intervention in insurance regulation, noting that operators in other segments of the financial sector generally comply with directives issued by their statutory regulators.
According to him, the Central Bank of Nigeria (CBN) and the National Pension Commission (PenCom) enforce capital and other regulatory requirements without allowing regulated institutions to turn the Ministry of Finance into an informal avenue for appealing regulatory decisions.
He said a similar approach should apply to the insurance industry.
Kari further referred to provisions of the Nigerian Insurance Industry Reform Act (NIIRA) 2025, particularly Section 8, subsections 6 and 9, arguing that the law provides procedures to be followed where an insurance operator’s licence is cancelled without assigning the Ministry of Finance a role as an appellate authority over NAICOM.
He consequently urged the Finance Minister to allow NAICOM to exercise its statutory responsibilities without political interference.
The former NAICOM boss acknowledged that governments could intervene where the failure of a financial institution posed a genuine systemic risk to the wider economy.
However, he argued that the present circumstances of NICON and Nigeria Re did not constitute such a threat, given their reduced market footprints compared with their historical positions.
Kari warned that granting regulatory concessions to non-compliant operators could have wider consequences for the economy.
He identified unfair competition, weakened incentives for recapitalisation, reduced investor confidence and increased risks to policyholders as some of the possible consequences.
He stressed that regulatory requirements were ultimately designed to protect policyholders and ensure that insurance companies had sufficient financial capacity to meet claims when disasters occurred.
“The Federal Government must resist the urge to grant special carve-outs or act as an informal court of appeal for failing operators,” he said.
Kari urged the Ministry of Finance to demonstrate its commitment to financial discipline by supporting the independence and statutory authority of NAICOM.
He said consistent enforcement of regulations would send a positive signal to domestic and international investors, insurers and reinsurers that Nigeria was committed to building a transparent, competitive and credible financial system.
He concluded by describing the letter as an appeal on behalf of stakeholders who, he said, were unable to publicly express their concerns about the direction of regulatory enforcement in the insurance industry.
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