Nigeria’s Armed Forces Hold the Key to Unlocking Insurance Industry Growth

……Amid years of stagnant insurance penetration, analysts say integrating the military could transform Nigeria’s insurance landscape

Despite decades of effort to deepen insurance adoption in Nigeria, penetration rates have remained stubbornly low—hovering around 0.5 to 1 percent, according to industry estimates. But industry stakeholders say a largely untapped demographic—the Nigerian Armed Forces—may be the catalyst needed to change that.

At a recent policy session in Abuja, the Commissioner for Insurance, Mr. Olusegun Ayo Omosehin, highlighted the Armed Forces as a “high-potential growth segment” for the insurance sector.

“If we can align the insurance industry with the discipline and structure of our Armed Forces, we could boost penetration and build a new generation of insurance believers,” Omosehin said.

Missed Potential in Plain Sight

The Nigerian military, comprising the Army, Navy, and Air Force, accounts for nearly 200,000 active personnel, with thousands more in paramilitary agencies, civil defense corps, and retiree ranks. While group life assurance is already provided under government directives, voluntary insurance uptake among military personnel remains minimal.

“This is a segment where risk is constant, structure is embedded, and discipline is second nature. It’s the ideal environment to grow insurance culture—but it has largely been ignored,” said, an insurance analyst with Haggai Advisory.

A Quiet Example of Impact

In 2018, during the burial of a soldier who died during a counter-insurgency operation in the Northeast, his widow received a payout under the Defence Insurance Scheme. “It was the only thing that helped us move forward,” she told reporters at the National Military Cemetery, Abuja.

That moment, while solemn, reflected the protective potential of insurance when properly implemented.

“The only reason she received that cheque was because the policy was compulsory,” said she. “Now imagine if the soldier also had a voluntary education plan or a home insurance policy. That is where the real transformation lies.”

Insurers Eye the Barracks

Industry leaders say the opportunity is ripe for insurers to engage the military with tailor-made policies—ranging from health and property insurance to micro-pensions and life coverage beyond the statutory group policy.

Companies like AIICO Insurance, Leadway Assurance, and Custodian Life already manage some government-aligned insurance portfolios. However, scaling voluntary participation requires more than product availability—it requires trust and outreach.

“Military personnel need to see insurance as a support structure, not just a deduction on paper,” said, Head of Retail Distribution at a Lagos-based insurance firm. “They need tailored education, digital onboarding tools, and post-retirement continuation options.”

Retirees Lead by Example

In Kaduna, retired Army Sergeant says an insurance policy taken during his final years of service proved critical. After retiring, he started a motorcycle transport business. A minor accident last year would have derailed his livelihood, but a personal accident policy he purchased in 2019 provided compensation.

“I tell all my men still in service—don’t wait until the last day,” he said. “Prepare now. Insurance helped me stand again.”

A Ripple Effect Across Civil Society

Analysts argue that military adoption could trigger a ripple effect. As military personnel begin to trust and use insurance products, civilian counterparts—especially in rural or semi-urban areas—may follow suit.

“If a soldier serving in Maiduguri sees value in insurance, civilians in Ogbomosho or Uyo are more likely to listen,” said, a development economist with an interest in financial inclusion. “It becomes a validation mechanism.”

Next Steps and Policy Direction

The National Insurance Commission (NAICOM) is exploring collaborative frameworks with the Ministry of Defence and Armed Forces Resettlement Centres. Proposals include barracks-based insurance awareness drives, embedded financial literacy programs, and integration into Armed Forces Cooperative Societies.

Industry observers believe this could be a turning point.

“In a country with chronic economic uncertainty and deep mistrust of financial products, leveraging the structure of the Armed Forces could be our strongest play yet,” he added.

For an industry in need of fresh momentum, Nigeria’s soldiers, sailors, and airmen may hold more than the country’s defense—they could hold its insurance future. What remains is for regulators, insurers, and the military hierarchy to seize the opportunity.

As Army Sergeant puts it, “We are trained to protect. It’s time we were also protected.”

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