Commissioner for Insurance, Mohammed Kari


As part of the Commission’s determination to improve financial inclusion in Nigeria, particularly to the underserved and excluded segment of the populace, the National Insurance Commission (NAICOM) has reviewed the Microinsurance Guidelines of 2013, and hereby releases a revised guidelines.

The commission in letter all Heads of Trade Associations and managing director and chief executive officers of Insurance Institutions, said Revised Microinsurance Guidelines became effective from 1st January, 2018.

The commission stated, “In exercise of the powers conferred by the National Insurance Commission Act 1997 and the Insurance Act 2003, the National Insurance Commission (hereinafter referred to as the Commission) hereby establishes uniform set of rules, regulations and standards for conduct of Microinsurance business in Nigeria”.

“No person shall commence or carry on any class of Microinsurance business without being registered or authorized by the Commission”, the guideline read in piece.

According to NAICOM the revised guidelines supersedes all other microinsurance guidelines.

“Any Microinsurer intending to commence Microinsurance business shall have a minimum capital as stipulated in appendix IV or as may be issued by the Commission from time to time.

A Microinsurer shall maintain with the Central Bank of Nigeria a statutory deposit of 10% of the Minimum Capital Requirement”

The commission warned that any microinsurer that default could be suspended or operating license withdrawn.

Objectives of the Guidelines according to the commission is to

Provide minimum standards for the conduct of Microinsurance business in Nigeria,

Ensure consumer protection.

Establish general features of Microinsurance.

Establish duties and responsibilities of Microinsurance operators and insurance intermediaries.

Establish conditions for entry and exit from the Microinsurance market.

For the purpose of this Guidelines, Microinsurance is defined as “insurance developed for low income populations, low valued policies, micro and small scale enterprises provided by licensed institutions, run in accordance with generally accepted insurance principles, and funded by premiums”.

Microinsurance products are insurance products that are designed to be appropriate for the low income market, low valued policies, micro and small scale enterprises in relation to cost, terms, coverage, and delivery mechanism.

Features of microinsurance include,

a. Simplicity meaning that the policies, conditions, procedures and marketing must be simple and the documentation must be presented in plain languages.

b. Understandability – The products/services risk, procedures and coverage must be unambiguous and easily understood.

c. Affordability and Accessibility – Microinsurance products must be affordable and accessible to the target market in terms of purchase, premium payments and claims.

d. Valuable – Microinsurance products or services shall be designed to meet the needs of clients, be beneficial, fair in price and coverage.

e. Efficiency – The delivery/distribution channels must be efficient to both the insurer and the policyholders.