By Rosemary Onuoha
The National Insurance Commission (NAICOM) said it is targeting the rural areas with its Market Development and Restructuring Initiative (MDRI) by creating awareness so that even the man in the village will feel compelled to take a policy because it is very cheap.
Mr. Fola Daniel, Commissioner for Insurance, who stated this at the inauguration of an advisory committee on the divestment of banks from insurance institutions in Lagos on Monday, regretted that buildings are still collapsing and lives are being lost.
Daniel however noted that the insurance companies are rising up to the challenge of implementing the MDRI because they are the ones essentially to implement as well as that they are the ones that will earn the money.
However, before now, NAICOM was set to commence verification and enforcement of the six compulsory insurance policies starting from Lagos State to other states of the federation.
The six products are: Third Party Motor Insurance (Section 68 of Insurance Act, 2003); Builders Liability (Section 64 of Insurance Act, 2003); and the Occupiers’ Liability (Section 65 of Insurance Act, 2003). Others are the Workmen’s Compensation of Section 40 of the Workmen’s Compensation Act, 1897; Health Care Professional Indemnity of Section 45 of the Nigerian Health Insurance Scheme, 1995 and the statutory group life of Section 3(2) and Section 9(3) of the Pension Reform Act, 2004.
The commission is now more than ever before equipped being the regulatory body with all the relevant stakeholders including the Council of Registered Builders of Nigeria (CORBON), Federal and State Town Planning Authorities; State Traffic Management Agencies, insurance practitioners and Insurance Consumers Association of Nigeria (INSCAN) and other relative authorities, is leaving no stone unturned to make insurance a household name in the country.
The verification and enforcement which ought to have initially commenced on March 1, 2011 was deferred because of the preparation for the country’s elections and would start after the elections are over. The states that have so far embraced the policies include Oyo, Sokoto, Borno, Kwara and Lagos states.
Daniel had said that a formidable enforcement team made up of all the stakeholders would commence the enforcement of the six compulsory insurance policies.
In Nigeria, a lot of people especially landlords, tend to limit the insurance to only Building under Construction, which is what the commission is trying to correct and ensure that all the compulsory insurance policies are enforced.
The insurance Act, 2003 makes the insurance of building under construction compulsory for the owner or contractor. This provides security against risk of bodily injury, death or property damage in the event of collapse building under construction. It protects workers on site and members of the public. Defaulters are liable to three years behind bars or N250,000 fine or both.
More also, the group life insurance as provided under the Pencom Reform Act, 2004, requires employers of five and more employees to have group life policy from registered insurer for the employees while in employment.
This provides for compensation in the event of death of staff while in service and to subsidize pension provision in the event of mental or physical disability. It applies to public and the private sectors. The responsibility to insure rests on the employer and failure attracts N250,000 fine and business premises may be sealed_up.
The decision, to enforce the six compulsory insurance policies in all zones and across the country had become a cardinal objective of the commission.
The team, the insurance commissioner said would carry out a nationwide verification and enforcement on the level of compliance to all the six compulsory insurance starting with Lagos State.
“The enforcement team would ensure that individuals and organisations insure their properties in line with the Market Development and Restructuring Initiative (MDRI) of the Commission.”
He added that the initiative was for the preservation of our income, national wealth, human and material resources that these insurance products are made compulsory. Heavy fines and prison terms are imposed by relevant sections of the laws for non_compliance.
“I strongly believe that one of the aims of compulsory insurance is to instill responsibility into all stakeholders that are connected with putting up public buildings including the town planning authorities, the architects, the surveyors and the landlords.
Lagos State, it would be recalled, inaugurated six compulsory insurances on December 8, 2010 and Mr. Babatunde Fashola; Governor of Lagos State noted that one of the most populous states in the country with over 250,000 housing units could not afford to undervalue insurance.
Insurance, Fashola elucidated, provides employment, guarantees taxes and helps a state to manage its risks, adding “I therefore, challenge insurance practitioners to embark on massive awareness campaign and take the enlightenment programme to the grassroots.” Mr. Fashola said that the insurance agency system should be modernised to reduce incidents of fake insurance.
He however urged the insurance operators to embark on massive awareness campaign, most especially at the informal sector, while also ensuring good services to the society at large.
“It is sad that notwithstanding the existence of these compulsory insurance products, people still die in motor accidents or during collapsed buildings without any form of compensation,” he said.