Nigeria’s biggest insurance firm, NICON loses licence, taken over by receiver manager

Nigeria’s biggest insurance company, National Insurance Corporation of Nigeria, NICON, has finally lost its operational licence and has been taken over by a Receiver Manager.

The operational licence of NICON – owned by the Federal Government and established in 1969 by Decree 2 – has been revoked by the National Insurance Commission, NAICOM, Nigeria’s insurance regulatory body.

NICON’s operational licence marked RIC – 049, was cancelled by NAICOM following the company’s persistent failure to meet prescribed regulatory requirements.

Following the revocation of the operational licence, NAICOM has appointed a Senior Advocate of Nigeria, SAN, Chukwuma-Machukwu Ume, as Receiver and Provisional Liquidator of the company.

In a swift move to safeguard the properties of the ailing firm, the Receiver Manager and Provisional Liquidator has issued a public notice notifying policy-holders, creditors, business partners, federal and state governments, the FCT and land registries to direct matters concerning the affairs, assets and business of the company to it.

The notification warned that transactions, contracts, commitments or other dealings purportedly undertaken on behalf of NICON, being In-Liquidation, would not be honoured without the ratification of Receiver and Liquidator.

The development effectively transferred the control of the company’s affairs to the appointed Receiver and Provisional Liquidator, who is mandated to secure the company’s assets, establish its liabilities and oversee the process of winding up its operations in accordance with the law.

NAICOM’s action against NICON is part of the regulator’s enforcement of the new capital requirements introduced under the Nigerian Insurance Industry Reform Act (NIIRA) 2025.

The commission had required insurance operators to meet the new minimum capital requirements within the stipulated recapitalisation period or have their operational licence revoked.

NICON Insurance was among operators that failed to satisfy the prescribed requirements within the stipulated deadline, resulting in the cancellation of its licence.

With the appointment of the Receiver Manager and Provisional Liquidator, the focus is currently on taking control of the company’s assets and records, identifying legitimate liabilities and ensuring that the winding-up process is conducted in an orderly manner.

The Receiver is also expected to liaise with NAICOM on matters arising from the liquidation and submit periodic reports on the progress of the process.

The development placed the interests of policy-holders, creditors and other stakeholders at the centre of the liquidation exercise, particularly the verification and settlement of legitimate claims and liabilities.

The appointment of a Receiver/Provisional Liquidator is considered in the insurance industry as a significant regulatory intervention as it removes the management of the affected company from the normal course of business and placed its affairs under the control of an officer charged with preserving and realising its assets for the purpose of settling lawful obligations.

The move is also to prevent unauthorised dealings with the company’s assets and ensure that transactions undertaken during the liquidation process are properly controlled.

NAICOM maintained in a statement that the enforcement of the recapitalisation requirements is aimed at strengthening the financial capacity of the insurance industry and ensuring that only adequately capitalised operators remain in business.

The regulator recently announced that 43 reinsurance companies had successfully met the new minimum capital requirements at the end of the recapitalisation exercise.