The passage of the Insurance Bill by the House of Representatives yesterday has set the stage for a new capital base for insurance companies.
The newly passed Bill specifies details of insurance business in the country and how the industry will be regulated.
The House concurred with the Senate, which passed the Bill on December 17, last year.
The clean copy of the Bill will now be sent to President Bola Ahmed Tinubu for assent, following
which the new Insurance will take effect.
Reinsurance attracts a capital base of N35 billion. For those involved in non-life insurance, the bill puts the capital at N15 billion or risk-based capital to be determined by the NationalInsurance Commission.
For life insurance, the capital base is N10 billion or a risk-based capital to be determined by the commission.
The bill provides a penalty of N250,000 or an imprisonment of 12 months or both for failure to have third-party motor vehicle insurance.
It imposes a fine of N500,000 on anybody acting as an unlicenced insurance agent.
It recognises two classes of insurance in the country – life and non-life.
The bill, when signed into law, will repeal the Insurance Act 2004, the Marine Insurance Act, 2004, the Motor Vehicle (third party insurance) Act 2004, the National Insurance Corporation of Nigeria Act, 2004 and the Nigeria Reinsurance Corporation Act, 2004.
The Senate, which passed the bill on December 17, 2024, recommended raising the paid-up share capital for reinsurance companies to N35 billion, up from the previous N10 billion.
