The National Insurance Commission (NAICOM) has called for accelerated regulatory reforms and deeper digital transformation across Africa’s insurance industry, warning that the continent’s persistent protection gap can only be closed through innovation in distribution, stronger supervision frameworks, and improved consumer trust.
This position was reinforced at the just concluded 52nd African Insurance Organisation (AIO) Conference, where industry leaders examined structural barriers limiting insurance penetration across Africa and explored pathways to unlocking broader financial inclusion and economic resilience.
Speaking during a panel session, Olusegun Ayo Omosehin, the commissioner for Insurance and chief executive officer of NAICOM, said Africa’s low insurance uptake should be viewed less as a market failure and more as an opportunity for expansion, given the scale of untapped demand across the continent.
He noted that despite persistent gaps in coverage, Africa already accounts for an estimated $68 billion in insurance premiums, a figure that points to strong underlying demand where access exists and products are properly tailored.
Omosehin argued that the central issue is not consumers’ unwillingness to buy insurance but the industry’s inability to effectively design and distribute products that reflect the realities of everyday Africans, particularly those in informal and rural economies.
“The gap is not about willingness to pay. It is about our ability to design and distribute products that reach people where they are,” he said.
The NAICOM CEO also drew attention to the growing role of technology in reshaping insurance delivery, noting that tools such as artificial intelligence and blockchain are improving efficiency and product development. However, he cautioned that these advancements must be carefully managed to avoid new risks, including data privacy concerns, cybersecurity threats, and potential algorithmic bias.
A major consensus from the panel was that distribution, rather than demand, remains the most significant barrier to insurance expansion in Africa. Participants observed that traditional agent-based models are increasingly inadequate, with estimates suggesting they fail to reach up to 90 percent of the potential market, particularly in underserved rural communities and the informal sector.
To address this, stakeholders advocated a transition toward more scalable and inclusive systems, including mobile-first insurance platforms, embedded products offered through everyday digital services, community-driven distribution channels, and broader investments in digital infrastructure to widen access.
The discussion also highlighted the rapid expansion of Africa’s digital ecosystem as a key enabler of change, with more than 500 million mobile subscribers and over 350 million mobile money wallets now active across the continent. These networks, participants noted, provide a ready-made foundation for low-cost insurance distribution and faster claims processing.
Regulatory reform emerged as another critical pillar for unlocking growth, with calls for a shift from traditional rule-based supervision to more flexible, principles-based frameworks. Participants also emphasised the need for risk-based capital systems and the expansion of regulatory sandboxes to support innovation while safeguarding market stability.
Nigeria’s ongoing insurance sector reform agenda under the Nigeria Insurance Industry Reform Act (NIIRA) 2025 was cited as a leading example of how regulatory modernisation can create space for innovation, strengthen oversight, and deepen market confidence.
Throughout the discussion, stakeholders stressed that innovation and consumer protection must evolve together, describing both as interdependent forces essential for building a more trusted and inclusive insurance ecosystem across Africa.
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