By Taiye Olayemi
Sovereign Trust Insurance Plc has urged the Federal Government to provide continued support and improved patronage to the insurance industry to ensure the successful implementation of the newly signed Insurance Reform Act 2025.
Mr Segun Bankole, Deputy General Manager, Corporate Communications and Investors Relations of the company, made the call in an interview with the News Agency of Nigeria (NAN) on Wednesday in Lagos.
Bankole commended President Tinubu for assenting to the Nigerian Insurance Industry Reform Bill (NIIRA).
He described it as a bold step toward strengthening the financial services sector and accelerating the country’s journey toward a one-trillion dollar economy.
NAN reports that the Insurance Reform Act 2025, signed into law on Aug. 5, introduces key provisions, including stringent capital requirements aimed at improving the financial strength of insurance companies.
Bankole said that while the reform was timely and necessary, it must be complemented by active government involvement and increased patronage from public institutions and individuals.
He noted that although recapitalisation would strengthen the industry, operators might struggle to survive if there was no increase in demand for insurance services.
Bankole warned that if local insurance firms were compelled to borrow or undergo mergers to meet new capital thresholds without adequate market support, it could strain their operations.
“With the new Act, recapitalisation is now enabled, which is commendable.
“However, if not properly managed, there is a risk that foreign players with stronger currencies could dominate the sector.
“If companies are forced to borrow to increase their capital base or they go into mergers and acquisitions, what happens if at the end of this, insurance patronage still remains low?” he asked.
According to him, the government needs to further ensure seamless implementation of the Act by encouraging insurance patronage.
“In other climes where insurance thrives, it is a part of everyday life. In Nigeria, low purchasing power has relegated insurance to the background for many citizens,” he added.
Bankole called for sustained public enlightenment and government-backed initiatives to encourage wider adoption of insurance among Nigerians.
“The reform is a welcome development, but the government must follow through with support to ensure the industry does not only survive but flourishes,” he said.