Key points:
NAICOM mandates linkage of all insurance policies with National Identification Numbers (NIN) to strengthen transparency and curb fraud.
The directive applies to both individual and group insurance policies nationwide.
Reform aims to enhance Know-Your-Customer (KYC) compliance and improve verification across government agencies.
Main story
The National Insurance Commission (NAICOM) has directed all insurance companies in Nigeria to link insurance policies to the National Identification Number (NIN) of policyholders by April 30 as part of efforts to enhance transparency and curb fraud in the industry.
Commissioner for Insurance and Chief Executive Officer of NAICOM, Olusegun Omosehin, disclosed this during a media interactive session in Lagos.
Omosehin said the directive forms part of strengthened Know-Your-Customer (KYC) requirements aimed at improving identity verification in insurance transactions across the country.
According to him, the new requirement will take effect from April 1, mandating insurers to ensure that every policy issued is directly connected to the policyholder’s NIN.
The NAICOM boss explained that the directive covers both individual and group insurance policies.
For group life insurance, Omosehin said employers would be required to provide the NINs of all employees covered under their policies to ensure accurate records and transparency.
He noted that the measure would address cases where organisations insure fewer employees than they actually have while submitting claims for individuals not captured under the policy.
Omosehin added that the policy would strengthen regulatory oversight and promote accountability within the insurance sector.
The issues
The Nigerian insurance industry has long faced challenges related to identity verification, fraudulent claims and weak compliance with regulatory standards.
Experts say the absence of a unified identity system in insurance transactions has made it difficult for regulators to accurately verify policyholders and track claims.
By linking insurance policies to the NIN database, regulators aim to enhance data accuracy, reduce fraudulent practices and improve compliance with statutory requirements.
What’s being said
Omosehin said NAICOM is also digitising its processes and building digital platforms that will enable government agencies to easily verify insurance records.
He disclosed that institutions such as the National Pension Commission and the Bureau of Public Procurement would be able to access the commission’s verification system to confirm the authenticity of insurance certificates and determine the number of employees covered under group policies.
”The reform aligns the Nigerian insurance industry with global anti-money laundering and counter-terrorism financing standards.”
He observed that the insurance sector had been the last major segment of the financial services industry to fully implement strict KYC requirements, unlike banks, telecommunications companies and stockbroking firms.
Omosehin also said the commission is strengthening consumer protection measures to build public confidence in the sector.
”NAICOM has established mechanisms to ensure fair treatment of policyholders, improve transparency in policy documentation, and promote prompt settlement of claims.”
The commission, he added, has also improved dispute resolution channels to enable policyholders lodge complaints and receive timely responses.
What’s next
NAICOM expects insurance companies and policyholders to comply fully with the directive before the April 30 deadline.
The commission will also continue implementing broader reforms in the sector, including its ongoing recapitalisation exercise aimed at strengthening insurance firms.
Bottom line
By mandating the linkage of insurance policies with the NIN, NAICOM hopes to strengthen identity verification, reduce fraud and enhance transparency, while positioning the Nigerian insurance industry for greater credibility and regulatory compliance.
