BusinessDay
Nigeria's leading finance and market intelligence news report.

Motor: Insurers embittered over premium loss to racketeers

…as 10m vehicle parade fake certificates

Insurance companies in Nigeria are worried over loss of premium to racketeers who issue fake certificates to unsuspecting motorists as motor third party policy.

At the last count, the industry through its data base could count only 3 million vehicles out of about 13 million vehicles registered in Nigeria.

Meaning that, at the least price of N5, 000 per policy, the industry is losing an estimated N5 billion annually to fake operators.

Meanwhile, the insurers under the umbrella body of the Nigerian Insurers Association (NIA) are engaging states across the country to increase enforcement.

The Association had engaged Lagos State in the past on enforcement of motor insurance through their licensing offices, and currently in talks with Kaduna, Niger, Kogi and Ogun States to ensure that motorists get genuine insurance cover at the point of renewing their vehicle particulars at licensing offices across the aforementioned states.

Corroborating this development at press briefing in Lagos, Ganiyu Musa, chairman, NIA, said the industry is embittered about what it is losing to insurance racketeers and non-insurance of vehicles, disclosing that, the association, on behalf of the insurance industry, is engaging five states with plans to extend to other states as the time progresses.

According to him, “we are also working closely with the state vehicle Inspection service on enforcement of Third Party Motor Insurance in the state. We are also engaging Niger, Kaduna, Kogi and Ogun States, and remain hopeful that other states will see value in the platform and embrace it. Out of the estimated 13 million vehicles in Nigeria, only about 2,939,767 Third Party Motor policies are in force as at Apr 26, 2021.”

Musa, who is also the group managing director/CEO of Cornerstone Insurance Plc, disclosed that the association is also partnering the Federal Roads Safety Corps (FRSC) and the police to give them access to the Nigerian Insurance Industry Portal (NIIP), such that, when a vehicle is apprehended, they can assess whether such vehicle carries fake or genuine insurance certificates.

Speaking on the Nigerian Insurance Industry Database /Nigerian Insurance Industry Portal (NIID/NIIP), Musa said: “The Nigerian Insurance Industry database was established to reduce soft market practices and eliminate fake insurance policies. The Association has taken a step further by creating the Nigerian Insurance Industry platform to enable vehicle owner’s purchase their third-party motor vehicle insurance cover from the comfort of their homes and telephones. So far, we are seeing a lot of traction on the platform across the states of the Federation and we are hopeful that other states will key into the project before the end of the year.”

On the Marine Module, he said: “As you are probably aware, the Central Bank of Nigeria has since integrated the NIA Marine Module into the National Trade portal and all insurance certificates required for import and export are generated from the Portal. This, no doubt, signals the end of fake Marine Insurance Certificates at the Ports.”

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