In Nigeria, takaful has its own framework: the National Insurance Commission regulates operators through dedicated guidelines, supplemented in 2023, and in 2019 the country had four takaful companies either licensed or approved in principle.
NAICOM, the insurance supervisor
The National Insurance Commission supervises the entire insurance sector in Nigeria. It issues takaful licences, publishes the guidelines that apply to operators and adopts circulars that impose new operating rules on the market as it develops.
Guidelines anchored in the Insurance Act 1997
NAICOM's Takaful Insurance Guidelines are presented as consistent with the Insurance Act 1997. They require registration as a full-fledged takaful operator and a company name that explicitly includes a term related to takaful.
Advisory council and investment policy
Each operator must have an Advisory Council of Experts, adopt an investment policy for the participants' risk fund and maintain a minimum deposit with a non-interest financial institution, in line with the principles of investing takaful funds.
A framework built with EFInA and GIZ
The drafting of the guidelines was supported by EFInA and by GIZ, the German development agency. In March 2015, NAICOM inaugurated its own Takaful Advisory Council of Experts, tasked with advising the regulator on compliance matters.
The 2023 rules for takaful and retakaful
In May 2023, NAICOM published two new sets of guidelines, one for takaful operators and the other for retakaful operators. The second set organises the compliant reinsurance that local companies need for their large risks.
End of mixed co-insurance on 1 January 2026
A NAICOM circular of August 2025 bans co-insurance between takaful operators and conventional insurers from 1 January 2026. In practice, a risk written under takaful can no longer be shared with a conventional company within the same placement.
Jaiz Takaful and Noor Takaful, licensed pioneers
Jaiz Takaful and Noor Takaful were licensed in 2016. Their arrival gave the country its first full-fledged takaful operators, in line with the guidelines' requirement for a dedicated structure rather than a mere department within a conventional insurer.
Cornerstone and Salam, composite operators
In September 2019, Cornerstone Takaful Insurance Company and Salam Takaful Insurance Company received approval in principle as composite operators, covering both family takaful and general takaful. The country then had four operators in total.
Lifting the ban on composites
These approvals followed the lifting in 2018 of the ban on companies combining life and non-life business. A single operator can thus manage family takaful alongside general cover such as motor or fire insurance.
Products open to all Nigerians
The guidelines state that takaful is intended for Muslims and non-Muslims alike. Products are aimed in particular at saving for housing, marriage, the Hajj pilgrimage, retirement and children's education, among other family goals.
Activity still low-profile in the market
In 2019, observers noted that the licensed operators remained barely visible. No verified figures on contributions or assets are available, so it is wise to ask each company directly for its accounts and any credit rating it may hold.
Nigeria compared with its West African neighbours
With a dedicated regulatory framework and several operators, Nigeria stands out clearly from Ghana, where takaful still awaits its rules. It serves as a benchmark for countries in the region considering how to regulate Islamic insurance.
How to buy cover from a Nigerian takaful operator
- Check with NAICOM that the chosen company holds a final takaful licence, not just an approval in principle.
- Make sure its name includes a takaful term and ask for the composition of its Advisory Council of Experts.
- Ask which model is applied, wakala or mudaraba, and request the investment policy of the participants' risk fund.
- Compare contributions, management fees and surplus distribution rules across Jaiz, Noor, Cornerstone and Salam Takaful.
- Read the exclusions and, for large risks, ask how retakaful is arranged since the ban on mixed co-insurance.
- Report any claim in writing with supporting documents, and keep the acknowledgement of receipt issued by the operator.
What a takaful participant pays in Nigeria
| Component | Where it goes | Points to check |
|---|---|---|
| Tabarru contribution | Participants' risk fund | Amount based on the asset, age and cover |
| Wakala fee | Remuneration of the managing operator | Percentage written in the contract |
| Mudaraba share | Return on the fund's investments | Profit-sharing ratio |
| Surplus | Possible redistribution to participants | Conditions and payment schedule |
| Excess | Share of the loss borne by the policyholder | Fixed amount or percentage |
Documents requested by Nigerian operators
- National identity card, passport or driver licence
- Proof of address
- Vehicle registration documents
- Title deed for the insured property
- Medical questionnaire for family takaful
- Islamic financing contract (murabaha, ijara) with a non-interest bank
Pitfalls to avoid with takaful in Nigeria
- Confusing an approval in principle with a final licence: always check the operator's current status with NAICOM.
- Buying from an entity whose name contains no takaful term, contrary to the requirement set by the guidelines.
- Ignoring the ban on co-insurance with conventional insurers for business risks renewed after 1 January 2026.
- Accepting a promise of surplus or savings returns that is not set out in black and white in the signed contract.
- Assuming that any so-called Islamic product from a conventional insurer meets the same requirements as a full-fledged takaful operator.
Takaful in Nigeria: your questions
How many takaful operators are there in Nigeria?
In 2019, the country had four: Jaiz Takaful and Noor Takaful, licensed in 2016, plus Cornerstone Takaful and Salam Takaful, approved in principle as composite operators. The current number should be checked with NAICOM.
Can a non-Muslim take out Nigerian takaful?
Yes. NAICOM's guidelines state that takaful products are available to Muslims and non-Muslims alike. The participant simply accepts the cooperative mechanism and the sharia-compliant investment rules that govern the fund.
What does the August 2025 circular change?
From 1 January 2026, a takaful operator can no longer share the same risk with a conventional insurer through co-insurance. Companies that had large risks covered by a mixed pool must therefore rethink how their contracts are placed.
Can Nigerian takaful be used to prepare for Hajj?
The guidelines list saving for Hajj among the aims of takaful products, alongside housing, marriage, retirement and education. Ask the operator for the product sheet and the opinion of its council of experts before joining.