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Policyholders connive with lawyers to defraud insurers

By Patience Saghana
Rather than follow appropriate procedure of filing for claims, policy holders  now resort to defraud   insurance companies  with the help of their lawyers.

Fraudulent and dishonest claims are a major problem for the insurance with concrete evidence of lies, inconsistent statements by some claimants (insureds)

The fraudsters desires is to deceive and induce insurance companies to pay for  what they did not lose or pay more than they otherwise would have.

And because of the motive  of  fraud,  policyholders, rather than file in all the necessary papers for claims processing, they route claims noficiations through lawyers to insurance companies. An insured with the intent to defraud an underwriter attempts to co-opt a lawyer to advance fraudulent claim through the courts.  And when such fraudulent claims are denied by insurance companies, insurers are tagged as quick to collect premiums and refusing to pay claims.

Mr Wole Oshin, Chairman of Nigerian Insurers Association (NIA) told journalists in Lagos recently that  there were lots of fraudulent insurance claimants, adding that insurance consumers were getting more informed by the day and in better position to ask for their right.

“The time has gone when underwriters would not just sit in the comfort of their offices and accept risk without going to access the risk they want to carry on.”

Oshin said, “Even in the face of the onerous challenges facing the industry, the association has not and will not abdicate its responsibility to the insurers’ the insuring public and indeed, all stakeholders.”

Policyholders had capitalised on the pressure of the insurane industry to avoid any thing that would dent their image including claims payment coupled with the emphasis and monitoring of the National Insurance Commission (NAICOM) regardng claims payment by the insurance companies, to make gain from the sector.

It was against this backdrop that the association  opened a complaint bureau.  According to Oshin, “In order to ensure that complaints arising from insurance transactions between our member companies and their clients are not left unresolved, The governing council has approved the establishment of a Customer Complaints Bureau to receive and mediate in conflicts between the insurer and the insured”.

“The aim is to bolster the confidence level and ensure quality service to our ever growing clientele. The person would be independent and could be a retired judge or a retired regulator”.

The NIA chairman said the recent CEOs’ retreat provided an opportunity for industry chieftains to chart the way forward for the industry in the face of the high rate of fraudulent claims, unfriendly economic climate, the challenge of maintaining high professional ethics and market discipline with the frankness and candour it deserves, he noted.

Meanwhile, Oshin commended the contribution of life insurance to estate development and mortgages to the sector,  warned against  rate-cutting in life business, stating that  a situation where life products were being discounted as in the case of property insurance was a dangerous trend and must be stopped immediately. ”


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