Joy Agwunobi
The National Insurance Commission (NAICOM),Nigeria’s insurance regulator, is stepping up efforts to reposition Takaful insurance as a critical driver of financial inclusion and long-term industry growth, amid ongoing reforms aimed at widening insurance penetration across the country.
This renewed focus came to the fore during an engagement between NAICOM’s management and members of the Takaful Advisory Council (TAC), as both sides explored practical pathways for scaling the non-interest insurance model in a market of over 200 million people that remains largely underinsured.
Speaking during the interaction,Olusegun Ayo Omosehin, the Commissioner for Insurance, described Takaful insurance as one of the most promising growth frontiers within Nigeria’s evolving insurance landscape, particularly as the industry adjusts to a new regulatory era under the Nigerian Insurance Reform Act (NIIRA) 2025.
Omosehin noted that while Takaful insurance is often associated with faith-based considerations, its underlying principles of mutuality, shared responsibility, and ethical risk-sharing give it broad appeal beyond religious boundaries. According to him, the real challenge for operators and regulators alike is converting Nigeria’s vast demographic potential into meaningful participation through deliberate awareness, product relevance, and trust-building.
“The opportunity is significant, but participation remains low,” Omosehin said, stressing that sustained growth would depend on how effectively stakeholders communicate the value proposition of Takaful insurance to underserved and excluded segments of the population.
Beyond market expansion, the Commissioner used the occasion to reaffirm NAICOM’s dual role as both regulator and industry developer. He explained that the Commission’s mandate extends beyond supervision to ensuring stability, protecting policyholders, and fostering a resilient insurance ecosystem capable of supporting economic growth.
He added that ongoing reforms within the insurance sector are designed to strengthen operators, improve governance standards, and enhance consumer confidence, conditions he described as essential for niche segments such as Takaful insurance to thrive sustainably.
A major boost to the sector, Omosehin recalled, was the formal recognition of Takaful insurance under the NIIRA 2025, signed into law by President Bola Ahmed Tinubu on July 31, 2025. The legislation, he said, marked a turning point by firmly embedding non-interest insurance within Nigeria’s legal and regulatory framework.
Industry observers see the move as a signal that Takaful insurance is no longer a peripheral offering but an integral part of the country’s insurance architecture, with room to scale alongside conventional insurance models.
Looking ahead, Omosehin expressed confidence that future growth in the insurance industry would be driven by inclusion-focused channels such as microinsurance, Takaful insurance, and digital distribution platforms, including web aggregators. To support this trajectory, he disclosed that NAICOM plans to institutionalise its engagement with the Takaful Advisory Council through annual consultative meetings aimed at addressing bottlenecks and unlocking new opportunities.
For the Takaful Advisory Council, the engagement was both symbolic and strategic.Abdulrazzaq Abdulmajeed Alaro, the Council’s chairman, described the meeting as a milestone, noting that it was the first formal interaction between TAC and NAICOM’s management since the Council’s establishment.
Alaro congratulated the Commission on the enactment of the NIIRA 2025, describing the law as unprecedented in its scope and impact on the insurance industry. He revealed that the Council had formally communicated its appreciation to NAICOM following the announcement of the new legislation, recognising its significance for the future of Takaful insurance in Nigeria.
While acknowledging regulatory progress, Alaro identified awareness as the most pressing challenge confronting the Takaful segment. He urged NAICOM to intensify industry-wide education efforts, arguing that misconceptions and limited understanding continue to constrain adoption, even among potential customers who could benefit from the model.
To address this gap, he called for more structured capacity-building initiatives, including retreats, workshops, and training programmes that cut across the entire insurance value chain. According to him, expanding knowledge should not be limited to Takaful operators alone but should involve brokers, agents, underwriters, and other stakeholders who influence consumer decisions.
As Nigeria’s insurance industry navigates a post-reform environment, the renewed collaboration between NAICOM and the Takaful Advisory Council signals a broader push to diversify insurance offerings and reach previously excluded communities,an ambition regulators believe could redefine the sector’s growth trajectory in the years ahead.
