The Federal Government yesterday moved to strengthen protection for insurance policyholders with the inauguration of the Insurance Policyholders’ Protection Fund (IPPF) Committee, describing the initiative as a major step towards rebuilding confidence in Nigeria’s insurance industry.

Speaking at the inauguration in Abuja, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the new framework would protect policyholders in cases where insurance companies become distressed or unable to meet obligations.

He said the committee was inaugurated under the provisions of the Nigerian Insurance Industry Reform Act (NIIRA) 2025, which he described as a turning point for the insurance sector.

According to him, the Fund is expected to serve as a financial safety net for policyholders, reduce systemic risks in the industry and strengthen public trust in insurance.

“The establishment of the IPPF demonstrates government’s resolve to safeguard the interests of policyholders and ensure that claims obligations are met in a timely and orderly manner even in cases of insurer distress,” he said.

Oyedele noted that the Federal Government was pushing broader reforms aimed at making the insurance industry more transparent, competitive and attractive to investors.

He added that the reforms would also deepen insurance penetration, improve financial inclusion and support economic growth.

In the same vein, Commissioner for Insurance and Chief Executive Officer of the National Insurance Commission (NAICOM), Olusegun Ayo Omosehin, said the inauguration marked a major shift from policy discussions to actual institutional protection for policyholders.

Omosehin said the Insurance Policyholders’ Protection Fund would be used to resolve cases involving distressed or insolvent insurance and reinsurance companies, including situations arising from licence cancellation.

“The IPPF is a statutory safety net for policyholders when an insurer becomes insolvent or is unable to meet its obligations,” he said.

According to him, beyond compensation, the Fund would help protect households and businesses from avoidable losses while preserving stability within the insurance market.

He warned members of the committee that their assignment was not ceremonial, stressing that the credibility of the Fund would depend on discipline, transparency and sound governance.