The National Insurance Commission (NAICOM) has partnered with the Federal Roads Safety Corps (FRSC) on the enforcement of compulsory motor insurance in the country.
The move will ensure that about 10 million uninsured vehicles in the country are captured into the insurance industry. The insurance industry is expected to generate additional revenue of N50 billion through this.
Mr. Sunday Thomas, the Commissioner for Insurance/CEO, NAICOM, spoke during a courtesy visit from The Corp Marshall, FRSC, Boboye oyeyemi, and his team, he said the partnership is needed to enforce vehicle insurance as part of the compulsory insurances, stating that, this move will eradicate insurance racketeers while ensuring that those who fail to comply are adequately prosecuted.
He promised that the regulatory body and FRSC will work out an effective plan for the enforcement of 3rd party motor insurance in the country.
Boboye Opeyemi, on his part, appreciated the concerns of the insurance regulator, noting that the road safety corps is more than ready to work with NAICOM to ensure vehicles on Nigerian roads carry genuine insurance certificates.
Newsmen had earlier reported that, of the estimated 13 million vehicles on Nigerian roads across the country, only three million of them have at least third-party motor insurance certificates, leaving about 10 million vehicles uninsured.
The 10 million uninsured vehicles, according to findings, were the ones owned by the government and private individuals and companies.
Investigation shows that some of these 10 million vehicles parade fake motor insurance papers, while some did not have any insurance coverage even as few who had genuine insurance papers before, have failed to renew when their previous motor insurance cover expired.
To this end, these uninsured vehicle owners newsmen findings show, have violated the Federal Roads Safety Corps(FRSC) Act which mandates all vehicles on Nigerian roads to carry at least a third-party motor insurance policy.
Third-Party Vehicle Insurance comes at a fixed price of N5,000 for privately used saloons and SUVs, while commercially used vehicles are charged N7,500 and in some cases, N5,000.
Using the N5,000 insurance valuation of which each vehicle should at least carry, the insurance industry can recoup N50 billion premium income annually if all the 10 million vehicle owners could be compelled to have genuine insurance certificates.
Low enforcement of compulsory motor insurance, according to market observers, has been responsible for the insurance apathy of road users.
To recoup the N50 billion, newsmen learned that, prior to this engagement, insurance operators, under the auspices of the Nigerian Insurers Association (NIA) have engaged Lagos State in the past on enforcement of motor insurance through their licensing offices. Similarly, there were already ongoing discussions 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.
The chairman, NIA, Mr. Ganiyu Musa, had earlier disclosed that 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 of Apr 26, 2021.”
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