Lessons from collapsed buildings: Compulsory structural engineering, insurance

On Monday November 1, 2021, Lagos experienced a terrible breakdown. A building in Ikoyi, known as 360 degrees, collapsed with over 50 people stranded in the building. 42 people have been declared dead and 15 survivors rescued.

According to Nigerian Geological Survey Agency (NGSA), about 500 avoidable deaths were recorded while over 1,000 victims sustained injuries of various degrees between June 16, 1990 and January 29, 2012. These incidents have occurred as a result of building collapses across the country.

The rising spate in building collapses creates a burgeoning investigation into the structure of buildings and real estate planning in Nigeria. In the Ikoyi building collapse, the structural engineers, Prowess Engineering Limited, had issued a letter to the building contractors, Fourscore Heights Limited on their request to disembark from the project. The engineers in their letter stated that “We couldn’t guarantee the integrity of the third (collapsed building) from anything above the fourth floor.”

The gravity of this statement puts all the construction workers lives at stake. Despite this letter, the structural engineers had a duty to disclose to the relevant government agencies and even to the public the integrity of the building. The lack of the engineers to provide open transparency has a semblance to a doctor failing to fulfil his/her duty on the Hippocratic oath. The oath gives a bond to medical personnel “to treat the ill to the best of one’s ability.”

The ill can be akin to the building as well as the lives of the construction workers and other visitors on the building site. These workers leave their families to earn a living having no idea of the foundational integrity of the building structure. They are basically foot soldiers having no clear picture without the general’s marching order.

Read Also: A tale of two biggest building collapses in Lagos

In 2016, a six-storey guesthouse owned by the Synagogue Church of all Nation (SCOAN) collapsed. As part of the investigations, it was identified that the construction lacked an accredited structural engineer, leading to poor building re-enforcements constructed by unskilled hands. This story also reinforces the demands for structural engineers in ensuring the integrity of building constructions.

Lagos State deputy governor, Dr Obafemi Hamzat, stated the building had been sealed for four months between July and November 2020. He confessed that the state government’s agency conducted some structural tests and observed some anomalies on the building. However, an observation from the agency’s statement is that there is a failure in the process of disclosing when buildings are shut down for structural issues. Just like the archetypal “EFCC keep off” slogan seeing on some buildings in Lagos, clear signs on sealed structures should be introduced to send an overt warning to both property buyers and construction workers. Hence, a caveat emptor signal is initiated by the government. It is necessary for improved disclosure to arise in the case of property buildings that face structural issues due to the potential danger it can face if not properly resolved.

The government also informed the public that the other two buildings would be tested for their structural integrity. This assurance may be gratifying but it also portrays a caution message on the need for corrective as against preventative maintenances to the structural integrity on ongoing high-rise constructions in Lagos. The Lagos State Building Control Agency (LASBCA) has a greater responsibility in improving the quality of building constructions in the state.

It has been identified that 65 percent of the building had been sold out. 360 degrees had been heavily funded using venture capital and off plan sales to the potential apartment owners. Considering the collapse of the building, there is an open risk on the buyers to recover their money already invested into the property. Concerns may arise about whether there is any evidence of insurance to mitigate against such investment risks.

Two insurance policies that would signify investor’s certainty are the Builder’s Liability Insurance and Contractor’s All Risk insurance. For builder’s liability insurance, section 64 of the Insurance Act stipulates that for insurance of buildings under construction, every owner or contractor of any building under construction with more than two floors must take an insurance policy to cover liability against construction risks caused by his negligence or that of his servants, agents or consultants which may result in death, bodily injury or property damage to workers on site or members of the public.

The Builder’s liability insurance provides indemnity in respect of Construction related Risks Resulting in Death of Site Workers; Death of Third Parties; Injury to Site Workers or Third Parties; damage to Site Workers’ or Third Parties’ property and even legal costs. Contractor All Risk, on the other hand, provides financial compensation to the insured for the cost of restoration of works following an unforeseen accidental event leading to a loss/damage.

Property buyers now require an extra sense in caution before investing into pre-completed structures. Buyers have a right to demand for insurance policies as well as structural documents before investing into a property. There is also a necessary requirement for contractors to ensure that investors are indemnified against any potential losses in the event of a building damage or collapse.

The loss of lives, the cost of which is irreparable could heavily have been prevented. Nigeria however is now in need of more quality real estate structures. The spate of building collapses provides a greater responsibility to real estate professionals, property owners, government agencies and even the society. We have a duty to ensure that the quality of properties is constructed in line with regulatory and global standards. With assured standards, the future of Lagos and Nigeria as an investment attraction is undeniable.

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