Finance Ministry halts NAICOM's N680m recapitalisation fees on NICON, Nigeria Re
By Aboki Forex —
The Federal Ministry of Finance has ordered the National Insurance Commission (NAICOM) to stop enforcing disputed recapitalisation charges totalling N680 million on NICON Insurance Limited and Nigeria Reinsurance Corporation, pending the resolution of a petition by the two firms.
In a letter dated August 6, 2026, the ministry also demanded a detailed legal justification for the fees. The letter, signed by Permanent Secretary Raymond Omachi on behalf of the Minister of Finance and Coordinating Minister of the Economy, was obtained by Nairametrics on Monday.
Disputed fees
The petition, dated July 27, 2026, challenged NAICOM's assessment of a 1% capital injection fee, along with additional processing and verification charges under Appendix 2 of the Commission's Minimum Capital Requirement Guidelines.
The ministry said NAICOM assessed N305 million against NICON Insurance and N375 million against Nigeria Re, bringing the total disputed fees to N680 million.
"The petitioners have raised notable grievances against the Commission regarding the assessment and demand for a 1% Capital Injection Fee alongside additional processing and verification fees pursuant to Appendix 2 of the Commission's Minimum Capital Requirement Guidelines, amounting to N305 million for NICON and N375 million for Nig Re," the letter read.
Companies claim compliance
The two firms told the ministry they met the statutory July 31, 2026 recapitalisation deadline by injecting N20 billion into NICON Insurance and N30 billion into Nigeria Re through Mudaraba Term Deposit accounts with Lotus Bank Limited. That exceeded their adjusted capital requirements of N16 billion and N28 billion respectively.
They also said they had deposited N2.5 billion and N3.5 billion with the Central Bank of Nigeria under Section 16(3) of NIIRA 2025, which requires only a 10% statutory deposit. The firms argued that NAICOM's directive to transfer their entire capital injection into a CBN escrow account was inconsistent with that provision.
NICON had already paid N80 million, while Nigeria Re paid N75 million towards the disputed charges.
Ministry directs suspension
"In view of the above, you are requested to provide a detailed response and legal justification regarding the issues raised," the ministry said.
The letter also stated: "Pending the determination of the petition, the Commission should suspend the enforcement of the contested processing fees, 1% capital injection fee demands, and full-capital escrow transfer directives against NICON Insurance Limited and Nigeria Reinsurance Corporation."
Background
The dispute follows NAICOM's announcement that 43 insurance and reinsurance companies had met the new minimum capital requirements under the Nigerian Insurance Industry Reform Act (NIIRA) 2025, while eight others remained under final verification. NICON Insurance and Nigeria Re appeared on neither list.
Nairametrics also reported that NAICOM revoked the operating licence of Nigeria Reinsurance Corporation over its failure to meet the statutory minimum capital requirement. The regulator froze all bank accounts belonging to the company and appointed Dr. Muiz Banire (SAN) as Receiver and Provisional Liquidator.
For the two insurers, the ministry's intervention offers temporary relief, but their licences and operations remain in limbo while the legal battle over NAICOM's fees and escrow directive plays out.