Government yet to accept compulsory insurance
By Favour Nnabugwu
National Insurance Commission (NAICOM) may still have a long way to go in enforcing the six compulsory insurance policies particularly on public liability as vehicle owners affected in the recent bomb blast at the Police Force Headquarters will not get compensation.
Insurance companies are not liable to pay compensation to affected vehicle owners as there is no public liability cover in place by the force.
Public liability insurance covers any damage caused by the insured to customers, visitors’ etc (third party) property. Public liability is compulsory for owners/occupiers of all public buildings and any building to which members of the public have access aside from cover against the hazards of collapse, fire, earthquake, storm and flood except when the fire policy is amended to accommodate public liability for the insured.
But the Nigeria Police Force, according to Vanguard findings, does not have public liability cover for which insurance companies would have paid owners of vehicles belonging to visitors that lost their cars to the explosion.
Mr Fola Daniel, Commissioner for Insurance defined public liability, ‘to include a tenement house, hostel, a building occupied by a tenant, lodger or licensee and any building to which members of the public have ingress and egress for the purpose of obtaining educational or medical service, or for the purpose of recreation or transaction of business etc”.
The insurance policy under sub-section (1) of Insurance Act 2003 covers the legal liabilities of an owner or occupier of premises in respect of loss of or damage to property or bodily injury or death suffered by any user of the premises and third parties.
Between 1987 and 2004, a total of 16 insurance products were made compulsory by means of statutory provisions. Even among the six compulsory insurances, only the third party motor insurance has enjoyed the desired popularity due to activities of law enforcement agents concerning the scheme.
Going by poor perception of insurance by Nigerians it is obvious that NAICOM alone cannot enforce this scheme effectively hence the need for collaboration with all tiers of government relevant agencies and institutions in the country.
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 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 Pension Reform Act 2004.
Affected owners of vehicles burnt in the explosion may begin to look elsewhere for the replacement of the cars except they had their cars insured before the bomb blast
Mr. Agele Alufohai the Nigerian Institute of Quantity Surveyors (NIQS) President admitted that there is a nexus between the insurance sector and building industry.
According to Alufohai, with appropriate policy, both industry will grow and influence Nigeria’s economy to be one of the largest in 20:20:20. He was of the view that few construction industry, if there is any, have insurance or commercial risk to protect against those who suffer injury or property damage, neither do they insure vehicles used in construction industry in a way it should be.
“For any economy that aspires to be a global leader, insurance should play a major role. Besides, using insurance products is also capable of closing Nigeria’s housing deficit,” said NIQS president.
