Lagos: The National Insurance Commission (NAICOM) has unveiled comprehensive guidelines to regulate Insurtech operations in Nigeria, with effect from Aug. 1. The new guidelines, which followed extensive consultation with industry stakeholders, aim to provide a clear regulatory framework for licensing, operations, and supervision of Insurtech firms across the country.
According to News Agency of Nigeria, NAICOM stated that the guidelines were introduced to promote innovation in the insurance sector, enhance consumer protection, and drive digital transformation. The framework is designed to reduce regulatory uncertainty, build public trust and confidence, and boost the development of new and innovative insurance products and services.
The guidelines outline key objectives such as promoting responsible innovation, defining product features specific to Insurtech, and providing a clear licensing structure for both partnering and standalone Insurtech firms. Under the new rules, two categories of Insurtech operators will be recognized: Partnering Insurtechs, which are allowed to transact specified classes of insurance in collaboration with licensed insurers, and Standalone Insurtechs, which may transact insurance as specified in their license but are restricted from offering special risk products such as oil and gas, marine and aviation insurance, retirement life annuity, and insurance for government assets and liabilities.
Prospective operators must submit applications in accordance with the procedures stated in the guidelines, and the commission reserves the right to impose licensing conditions as necessary. Insurtech firms will also be required to adhere strictly to prudential and market conduct provisions covering risk management, investments, actuarial practices, outsourcing, and other operational standards aligned with the commission's prudential guidelines.
To ensure fair business practices, the guidelines provide a dispute resolution mechanism requiring Insurtechs and their partner insurers to resolve disputes through arbitration before approaching the Commission. Consumers have the option to escalate unresolved complaints directly to NAICOM for intervention.