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Insurance industry to rake in N212m from 3rd party insurers

By Favour Nnabugwu

INSURANCE industry will begin to rake in a whopping N212billion income from third party insurance if the Bill currently at the National Assembly to increase 3rd  party from N5,000 to N20,000 sails through.

The Federal Road Safety Commission (FRSC) said it duly registered 10.6 million vehicle across the country in 2016, meaning that owners of the vehicles  will have to pay N20,000 each to either purchase or renew their third party motor insurance policies once the proposed bill is passed into law.

It will be recalled that a bill to increase motor vehicle third party insurance premium from N5,000 to N20,000 has scaled second reading and referred to Senate Committee on Banking, Insurance and Other Financial Institutions. The Bill, sponsored by Senator Umaru Kurfi from Katsina Central, and entitled:

‘SB 276 Motor Vehicles Third Party Insurance Act (Amendment) Bill, 2016’, seeks to amend the Act to ensure the accomplishment of objectives of the compulsory third party insurance cover. According to the Senator, “Increasing the premium from N5,000 to N20,000, shall ensure effective settlement of claims.”

He also proposed the setting up of a fund by taxing motor underwriters, stressing that the fund should be used to settle victims of accident who could not obtain compensation or where an insurance company becomes insolvent or goes into liquidation before judgment was obtained by the victim.

The bill reads: “Motor Vehicles Third Party Insurance 2004 (Amendment) Bill, 2017 (SB.276);, Motion Made;, That a Bill for an Act to Amend the Motor Vehicles Third Party Insurance 2004 to facilitate the accomplishment of objectives of compulsory Third Party Insurance and for Related Matters, 2017 be read the Second Time (Senator Umaru l. Kurfi – Katsina Central);,

Debate;, Question put and agreed to;, Bill accordingly read the Second Time and referred to the Committee on Banking, Insurance and Other Financial Institutions to report within Four (4) weeks; senate (Votes and Proceedings) Jan 2017.”

 

 

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