THE Police commenced full enforcement of the Third-Party Motor Vehicle Insurance policy from February 1, 2025.
This move is in compliance with directives from the Inspector General of Police, Kayode Egbetokun, and aligns with the Insurance Act and the Motor Vehicle (Third-Party Insurance) Act, which require all vehicle owners to have at least third-party insurance coverage.
Some of the benefits of third-party insurance include providing compensation to victims of road accidents and covering injuries and damages sustained during travel.
Driving is an unpredictable activity. One minute you are cruising, enjoying the luxury of your car, and the next, a little distraction causes you to crash into another vehicle.
Depending on how serious the crash is, it could result in car damages and bodily injuries where you have to bear the cost of repair or foot the hospital bills. This is where having third-party insurance makes the difference.
Besides being on the right side of the law, Third-Party Vehicle Insurance protects you from unplanned financial exposures to legal liabilities resulting from being sued by the victims of an accident you caused.
The number of vehicles with fake certificates on Nigerian roads has risen to 9.4 million. The Nigeria Insurers Association revealed that only 2.72 million vehicles have valid insurance covers as of February 2021.
These fake insurance certificates result from purchasing from unauthorized agents.
The Federal Government, through the National Insurance Commission (NAICOM) in December 2022 reviewed the premium rate for motor insurance in Nigeria that became effective 1st January 2023.
In the reviewed rate, private vehicles that were paying N5, 000 premium for N1 million Third Party Property Damage (TPPD) limit now pays N15, 000 premium for N3 million TPPD, while owner good vehicles are to pay N20, 000 premium for N5 million claims limit, and staff busses are to pay N20, 000 premium for N3 million claims limit.
For commercial trucks and general cartage, they are to pay N100, 000 premium for N5 million TPPD limit; Tricycles N5, 000 for N2 million TPPD limit, and Motor Cycles N3, 000 for N1 million TPPD limit.
While for comprehensive motor insurance policy, premium rate shall not be less than 5 percent of the sum insured after all rebates and discounts.
Policyholders who have taken out the insurance policy can check the genuineness of their motor insurance policy by visiting www.askniid.org or by sending Short Messaging Service (SMS) to the USSD code *565*11# on any mobile phone with or without internet access.
In most countries, including Nigeria, third-party insurance is the minimum required by law to drive a vehicle on public roads. It is cost-effective as it is generally more affordable compared to comprehensive insurance since it offers limited coverage.
To assist in selecting the most suitable motor insurance policy in Nigeria, some reputable insurance providers offer various coverage options and add-on: Allianz Nigeria offers comprehensive car insurance with benefits like a 15 percent discount for women and men aged 45 and above and rewards for safe driving.
AIICO Insurance provides comprehensive auto insurance covering damages from accidents, fire, theft, and third-party liabilities. Their user-friendly online platform allows for easy quote comparisons.
AXA Mansard offers affordable car insurance that covers losses resulting from accidents, floods, fire, and theft. They provide a 5 percent discount for full-year payments.
Leadway Assurance provides comprehensive auto insurance with extensive coverage against fire, theft, and other damages to your vehicle.
Custodian Insurance offers motor insurance policies that cover repairs or replacement costs in the event of accidents, fire, or theft, including medical expenses.
When comparing these providers, consider the following factors:
Coverage options: Ensure the policy covers your specific needs, including any desired add-on.
Premium costs: Compare premiums to find a policy that fits your budget.
Claim settlement process: Research the efficiency and customer satisfaction regarding claim settlements.
Customer service: Evaluate the quality of customer support and assistance provided.