The Federal Government has constituted an Insurance Policyholders’ Protection Fund (IPPF) Committee to protect insurance consumers in the country.
This marks a significant step in the implementation of the Nigerian Insurance Industry Reform Act (NIIRA) 2025, a landmark legislation that reinforces the administration’s commitment to financial system stability, policyholder protection, and economic resilience.
Speaking at the milestone event, the Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele who inaugurated the Committee on Friday in Abuja, noted that the insurance sector remains a critical pillar of any modern economy, as it provides the foundation for effective risk management, financial protection, capital mobilisation, and sustainable economic growth.
The Minister, who was represented by the Permanent Secretary, Federal Ministry of Finance, Mr. Raymond Omachi, said by mitigating risks, insurance enables businesses to invest with confidence, supports innovation, and offers individuals and families protection against unforeseen events.
Oyedele said in Nigeria, the insurance sector holds vast untapped potential. Explaining that with strengthened regulatory frameworks and increased public confidence, the industry is well-positioned to play a more strategic role in infrastructure financing, financial inclusion, and overall contribution to Gross Domestic Product (GDP).
He mentioned that the Federal Government, under the leadership of President Bola Tinubu, recognizes that a robust, efficient, and trustworthy insurance sector is essential to achieving broader economic objectives, including diversification and sustainable development.
According to him, the enactment of the Nigerian Insurance Industry Reform Act (NIIRA) 2025 marks a turning point for the sector, as it introduces a modern, risk-based regulatory framework aligned with global best practices and tailored to the evolving dynamics of Nigeria’s insurance market.
He noted that the new Act has: Strengthened regulatory oversight and supervisory effectiveness; Enhanced policyholder protection mechanisms; Promoted transparency, accountability, and market discipline; Encouraged innovation and competitiveness within the industry; and Created a more investor-friendly environment that supports both domestic and foreign investment.
“Most importantly, the Act places policyholder protection at the core of insurance operations, recognising that public trust is fundamental to the growth and sustainability of the industry. It is within this context that the Insurance Policyholders’ Protection Fund (IPPF) assumes critical importance,” he added.
The Minister stated that the establishment of the IPPF Committee demonstrated the administration’s resolve to safeguard the interests of policyholders and ensure that, in the unlikely event of insurer distress or failure, policyholders are protected and their claims obligations are met in a timely and orderly manner.
According to him, the IPPF would Provide a financial safety net for policyholders; Enhance confidence in the insurance ecosystem; Mitigate systemic risks within the sector; and Align Nigeria with international best practices on policyholder protection schemes.
“This initiative sends a clear message that the Nigerian insurance industry is secure, reliable, and responsive to the needs of its stakeholders,” he added.
While congratulating the members of the IPPF Committee, Oyedele urged them to ensure that the Fund is: Adequately structured and sustainably financed; Efficiently managed with transparency and accountability; Responsive to emerging industry risks and developments; and Operated in strict compliance with the provisions of NIIRA 2025.
Earlier, the Commissioner for Insurance/Chief Executive Officer of the National Insurance Commission (NAICOM), Mr. Ayo Omosehin, said the inauguration marks a major step in strengthening confidence in Nigeria’s insurance market and deepening consumer protection.
Mr Omosehin said with the establishment of the Insurance Policyholders’ Protection Fund Committee pursuant to Section 212 of the Nigerian Insurance Industry Reform Act, NIIRA 2025, the Commission moving from policy intent to institutional protection that gives policyholders greater assurance and gives the market greater credibility.
According to him, the objective of the Committee in line with the statutory provision is to: Ensure protection of policyholders and beneficiaries covered under an insurance policy in Nigeria. Ensure timely and accurate collection of contributions to the Fund. Establish sound management and investment practices for the Fund. Provide procedures for disbursement and recovery of loans from the Fund, and Promote transparency, accountability, and governance in the administration of the Fund.
He said the fund shall be used for the purpose of resolving distress and insolvencies of licenced insurers and Reinsurers or as a result of cancellation of licence.
