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Your third party insurance works

General attitude of Nigerians towards motor third party insurance. The attitude of Nigerians – the insurance buying public towards motor third party insurance is lukewarm and not in any way different from their general perception of insurance products and services as gambling, betting, fraud, or deceitful transactions. Quite often, buyers of the motor third party insurance are statutorily compelled to buy the third party cover under the provision of the Motor Vehicle Third Party Insurance ACT of 1945, before anyone could drive or put their vehicles to use on the highway.

Most Nigerians therefore buy the motor third party insurance cover in strict compliance with the enabling Act of 1945 that made it compulsory for all vehicle owners, and hardly care to bother about the benefits derivable or the extent of cover granted, or the legal validity of the insurance contract documents.

They usually don’t verify or check the genuineness of such covers often obtained or bought at the point of registering and licensing their vehicles, which in most cases have been found to be fake insurance papers, and that are not easily detected by law enforcement agents, until they are presented in support of a claim following an accident involving the insured vehicle.

In essence, the greater bulk of motor third party insurance covers often bought at the point of registering or licensing new vehicles are fake and are not legally valid insurance papers.

The insuring public and buyers of motor third party insurance are therefore advised to approach the well-established and authorized insurance firms for the valid insurance covers, or in the alternative, approach any of the licensed & authorized insurance Brokers for valid insurance covers.

What is motor third party insurance?

This is the insurance cover made compulsory by the Motor Vehicle Third Party Insurance Act of 1945.

The 1945 Act made it mandatory for all vehicle owners and users to obtain the Third Party Insurance cover before driving or putting their vehicles to use on the road or highways.

It therefore becomes an offence punishable in law for any person contravening the provisions of the law. The underlying objective of the 1945 Act is to protect the interest of innocent public or third parties that may sustain death, or bodily injury, and damage to their assets & property following an accident caused by the insured vehicle. Prior to the enactment of this Act, innocent third parties or members of the public were unduly exposed to uninsured risks of this nature, and were therefore left to suffer as there was no form of compensation or relief accessible to them.

How does motor third party works?

In strict compliance with the enabling Act, all motor vehicle owners are compulsorily mandated to buy the Third Party Insurance cover before they could drive or put their vehicles to use on the roads or highways. If any vehicle owner or operator fails to comply, it becomes a breach of the provisions of the law leaving the culprit to penalties under the law. This explains why the law enforcement agents oftentimes conduct spot-checks of vehicle insurance papers on the highways.

What are the covers provided?

In line with the objectives underlying the enactment of the Motor Third Party Insurance, the covers which are solely meant to protect the interest of the general public – innocent Third Parties are broadly in two categories namely:

1.To pay compensation in an unlimited quantum or amount for any third party sustaining death or bodily injury resulting from an accident involving the insured vehicle.

2.To pay compensation for damage to asset or properties of third parties resulting from an accident involving the insured vehicle up to a limit under the standard policy provision, that can always be extended to higher limits at an extra charge.

3.To pay for legal cost and expenses incurred with the consent of the insurance firms providing the cover in defending any legal action or liability claim consequent upon an accident involving the insured vehicle.


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