As enforcement of Third Party Motor Insurance kicked off Penultimate week, Ebere Nwoji captures reactions of the road users
In compliance with Section 68 of the Insurance Act 2003, the Nigerian Police Force on February 1, 2025 commenced the enforcement of the compulsory Third Party Motor insurance as announced by the Inspector General of Police (IGP), Kayode Adeolu Egbetokun.
This is coming exactly two years after the National Insurance Commission (NAICOM) on January 1, 2023 announced 200 per cent increase in the premium payable on the same Third Party Motor Insurance from N5000 to N15000.
The commission had at the same time increased the claims on the policy from N1million to N3million.
When the news of the increase in the premium on the policy hit the air in 2023, many Nigerians objected and protested against it notwithstanding the increase in the claims value. Indeed, some groups wrote the commission expressing their disguisement and unwillingness to comply.
The reason is clear, this particular policy among other five compulsory insurances has suffered the worst abuse by motorists and their fake insurance certificate sellers.
The police who were supposed to enforce the compliance was over the years complacent. As a result, fakers of Third Party Motor Insurance certificate were every where selling their fake certificates as low as N1000. Of course such fake certificate sellers do not attend to claim when it occurs as the certificate issuer is usually no where to be found in time of accident since it is not a genuine or existing insurance firm.
Outcome of negligence
The result of this anomaly is that over the years, victims of accident whom the policy is meant to cater for were left to their fate whereas the Third Party Motor Insurance as the name bears is meant to take care of the third party road user in the event of accident.
The Motor Vehicles (Third Party Insurance) Act[1] and Section 68 of the Nigerian Insurance Act (2003)[2] mandate that all vehicles operating on public roads must have valid Third Party Insurance.
This means that when a Third -Party -insured vehicle is involved in accident that injured or killed the victim, the insurance company that the vehicle bought Third Party Motor Insurance from will take care of the victim or repair his vehicle. If the accident involves death,the insurer of that vehicle that killed the victim will pay his family unlimited sum depending on his personality.If it is injury, the sum of N3 million will be paid to him.
But over the years claims on this particular policy was hardly paid as such, motorists buy the policy anywhere at the cheapest available price just to pass police checkpoints.
The result is that there have been incessant cases of hit- and -run vehicles because owners of such vehicles did not insure them with genuine insurance company therefore cannot make claims. They rather leave their victims to take care of himself whereas the insurance company that sold the Third Party Motor Insurance should have taken care of the victim if the vehicle owner had bought his policy from a genuine insurance company.
At motor parks, licensing offices, road safety commission’s office you can ask and obtain the fake Third Party Motor Insurance certificate without stress.
This trend continued even after the creation of the Nigerian Insurance Industry Data Base (NIID) in 2011 through the collaboration between NAICOM and Nigeria Insurers Association (NIA).
The NIID
The NIID was meant to serve as the only centeral record of all insurance policies in Nigeria to enable motorists ascertain whether the Third Party Insurance certificate they purchased is from genuine insurance organisation or from fake and non existing firms.
The police was to enforce this but it failed on its duty in this regard over the years until January 1, 2025 when the IGP announced the commencement of the exercise.
It now two weeks after the commencement of the enforcement and THISDAYLIVE sets out to see the extent of the success recorded.
According to findings, after the IGP’s announcement, most motorists thought it was business as usual as some did not bother to check whether their certificates have expired. They continued driving their vehicles until at police checkpoint, they were stopped and their vehicles impounded.At various police checkpoints in Lagos in particular, there are many vehicles parked by the police to ascertain the status of their Third Party Motor insurance. Indeed, at some checkpoints, one sees long queues of impounded vehicles with either no insurance certificate at all or with fake certificates with their owners subjected to questioning and arguments by the police.
Motorists in Abuja said they experienced the same, likewise those in south East and South West parts of the country.
Motorists
Many motorists whose vehicles were impounded on Lagos roads were seen wearing stern faces under the son trying to argue their way out from the hands of police men. while some were seen complying.
But some police personnel are yet to understand the difference between third Party Motor Insurance and Comprehensive Motor Insurance as they insist that motorists with comprehensive motor insurance which supposed to take care of both the Third Party and vehicle owner must present separate Third Party Moto Insurance certificate which is the least insurance any motorists should have.
This is ridiculous and calls for proper education of police officers at the checkpoints some of who are now being tutored by the motorists on the two motor insurance policies.
On their part, both NAICOM and the NPF are making serious efforts to sustain the enforcement. To ensure seamless enforcement, NAICOM inaugurated a joint committee on enforcement of compulsory insurance laws. The inaugural meeting recently took place at NAICOM’s headquarters Abuja.
implementation committee Inauguration
At the committee inauguration, the Commissioner for Insurance, Mr Ayo Omosehin, who was represented by the Deputy Commissioner for Insurance, Finance and Administration Mr. Ekerete Ola Gam-Ikon said the development was collaborative move of the duo to strengthen insurance compliance in the country and the announcement by the Inspector General of Police on the enforcement of motor vehicle insurance effect from February 1, 2025,
The commissioner said one of the objectives of the committee inauguration was to develop and implement strategies for enforcing compulsory insurances in Nigeria.
The Police Force team was led by DCP Mallum Maina.
According to NAICOM, other objectives of the committee were to ensure compliance with compulsory insurance policies as mandated by the Insurance Act and other related laws.
The committee was also to foster synergy and collaboration between NAICOM and NPF, provide training and capacity-building programs for personnel of both organisations on compulsory insurances among others.
NAICOM, highlighted the scope of operation of the committee as evaluating existing challenges in enforcing compulsory insurances and propose solutions, developing protocols for joint enforcement operations of compulsory insurances, recommending policy reforms to strengthen insurance compliance, undertake public sensitisation programs on compulsory insurances, develop training programs for personnel of both organisations on compulsory insurances.
The commission said the joint committee’s inauguration marked a significant step towards ensuring that all vehicle owners comply with compulsory insurance laws. “This collaboration aims to promote a safer and more secure environment for all road users”, the committee stated.
NIA Chairman View
Speaking on the feelings of insurers on the enforcement, NIA Chairman, Mr Kunle Ahmed, commended the Inspector General of Police (IGP) and the Nigeria Police Force for the enforcement saying it would stand as game changer in compulsory motor insurance sales in the country.
Ahmed said the initiative aligned with the provisions of Section 68 of the Insurance Act 2003 and a significant step towards
strengthening compliance, ensuring road safety, and protecting motorists and third parties on Nigerian roads.
He said it was a welcome development and a timely and commendable action by the Nigeria Police Force. He further emphasised the importance of enforcing the policy to improve risk management, industry innovation and fostering economic growth.
According to him, the enforcement of third-party motor insurance is not only a compliance issue; but a vital strategy for ensuring financial protection for victims of road accidents and the car owners.
He said the third-party insurance policy also provided compensation for property damage and medical care for injured third parties, which further contributed to building confidence in the insurance sector.
“The NIA recognises the immense potential of this enforcement to drive positive change in the insurance industry and the broader economy. With millions of vehicles on Nigerian roads, this move is expected to increase the number of genuinely insured vehicles, reduce the prevalence of fake insurance policies, and create a more robust safety net for motorists and road users alike,” he explained.
View of motorists
Some motorists who spoke to THISDAY on the enforcement said it was a good development as any body could be involved in accident at any time . They however said the enforcement notice was too sudden . One of the motorist Justus Nwaka said he has welcomed the sudden change but that he was waiting for claims so that he would know whether the change was wholistic or targeted only on motorists.
Industry analysts said the enforcement would go a long way to enhance public awareness on insurance especially among motorists and other road users.
According to them with this enforcement, everybody would be compelled to buy his insurance policy for his vehicle from genuine insurers, pay the minimum officially approved premium and ask for claims when risk occurs.
They therefore warned insurers that it will no longer be business as usual when they pretend that there is no claims attachment to Third Party Motor Insurance.
According to the analysts, with what is happening now everyone is aware that once the correct premium is paid , the buyer must call for his claims when accident occurs. Insurers are cautioned not to allow the current interest among Nigerians in buying their Motor Insurance policy from genuine insurers at the right premium to wane through their poor attitude towards claims payment in form of vehicle repairs without much argument and delays.
