The National Insurance Commission has launched a five-year programme aimed at increasing insurance penetration in Nigeria from the current 0.5 per cent of Gross Domestic Product to 10 per cent by 2031.
The target is contained in the Insurance Sector Strengthening Programme, a 36- to 60-month initiative introduced by NAICOM in partnership with stakeholders in the insurance industry.
The programme is designed to address the major challenges limiting the growth of insurance coverage in the country.
NAICOM Identifies Major Challenges
The commission said the programme would focus on low public awareness, weak consumer confidence, distribution gaps and inadequate industry capacity.
It will also address limited access to insurance products among women, youths and Micro, Small and Medium Enterprises.
These groups often face financial risks but may have limited access to formal insurance services.
As a result, many individuals and businesses continue to rely on personal savings or informal arrangements when dealing with unexpected losses.
Insurance Reform Must Produce Results
Speaking at the launch, the Commissioner for Insurance and Chief Executive Officer of NAICOM, Olusegun Ayo Omosehin, said the industry had reached a point where reform could no longer remain at the level of policy intentions.
He said reforms must translate into measurable improvements in insurance coverage and consumer confidence.
Omosehin noted that Nigeria’s large population and economy provided significant opportunities for insurance growth.
However, many Nigerians remained either uninsured or underinsured.
Programme to Improve Access
The Insurance Sector Strengthening Programme is expected to support reforms across the insurance value chain.
These reforms will include product development, distribution, consumer protection and industry capacity.
The programme will also focus on improving public understanding of insurance and making insurance products more accessible.
According to NAICOM, stronger distribution channels will be important in reaching people who currently have limited access to insurance services.
Digital platforms and other innovative channels could also help insurers serve more customers.
Why Insurance Penetration Matters
Insurance provides financial protection against risks such as accidents, disasters, illness and business losses.
When individuals and businesses have adequate coverage, they may be better positioned to recover from unexpected financial shocks.
For businesses, insurance can also support investment and improve confidence in long-term operations.
However, low awareness and limited trust have continued to affect the growth of the industry in Nigeria.
Focus on Women, Youths and MSMEs
NAICOM’s programme places particular emphasis on women, youths and MSMEs.
These groups play important roles in Nigeria’s economy but often face challenges accessing formal financial services.
Improved insurance coverage could help small businesses manage risks and protect their investments.
It could also support financial inclusion by bringing more people into the formal financial system.
Outlook for the Insurance Industry
Achieving 10 per cent insurance penetration by 2031 will require sustained cooperation among regulators, insurers, brokers, agents and other stakeholders.
The industry must also develop products that are affordable, understandable and relevant to the needs of consumers.
NAICOM’s programme provides a framework for improving coverage.
Its success, however, will depend on how effectively the industry converts the programme’s objectives into practical improvements for Nigerians.
