Friday, 5 October 2018

List Of All The Compulsory Insurance Policies In Nigeria


Ever wondered why it's mandatory that you must register for your car insurance in Nigeria? 
A typical Nigerian believes that having a car insurance doesn't work and will readily repair his or her car whenever an accident occurs.
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In Nigeria however,there are some compulsory insurance laws that must be obeyed,or the individual may risk being arrested by law enforcement agents.  

List Of The Compulsory Insurance Policies In Nigeria

The objective of compulsory insurance policies in Nigeria is to provide protection to third parties as well as the general public.
Listed below is the full list of all the compulsory Insurance Policies In Nigeria: 
  • (a) Builders Liability Insurance
  • (b) Employers Liability Insurance
  • (c) Motor 3rd Party Liability Insurance
  • (d) Employers Liability Insurance (Group Life)
  • (e) Occupiers Liability Insurance 
  • (f) Healthcare Professional Indemnity Insurance

1. Builders Liability Insurance

Under the Insurance Act 2003/under the Lagos State Building Control Law 2010.
This insurance policy is compulsory for contractors and owners of buildings higher than two floors.
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This is to enable them provide compensation to their workers in case of building collapse, injury and death at the construction site.

Under the laws failure to comply with the policy attracts a penalty of N250,000 in addition to three years’ imprisonment, sealing and demolition of the affected building.


2. Employers Liability Insurance


Under the Workmen’s Compensation Act 1987.
This law is targeted at employers and requires them to have insurance that will provide compensation for their workers in the event of injury,illness or death in the course of the employment. 
The employee or their relative therefore has the right to claim compensation in the advent of any of the incidents mentioned earlier.

For employers that refuse to comply, the penalty is N250,000 plus record of conviction and sealing off of the business premises of the employer.
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3. Motor 3rd Party Liability Insurance

Under the Insurance Act 2003 Section 68

The law states that:

"No person shall use or cause or permit any other person to use a motor vehicle on a road unless a liability which he may thereby incur in respect of damage to the property of third parties is insured with an insurer". 

This insurance policy was made compulsory for owners and drivers of vehicles, motorcycles and other special type vehicles (both private and commercial). 
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It is the required minimum policy by law and covers against liabilities such as death,damage to property or bodily injury of a third party arising due to the use of the insured vehicle.
The life cover is unlimited while the property damage is N1million. 

The penalty for failure to comply is N250,000 or one year imprisonment or both.


4. Employers Liability Insurance (Group Life)

Under the Pension Reform Act 2004

Employers with staff strength that is greater than four are mandated by law to buy into this policy. The law cuts across both public and private employers and under this law they are required to pay for pension subsidy in the event of mental or physical disability, death or disappearance while in service.


5. Occupiers Liability Insurance 

Under the Insurance Act 2003 and Lagos State Law
This is an insurance policy mandated by law for the owners or occupiers of public buildings used as residential, offices, filling stations,hostels Etc.

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Compensation is paid to the business users and members of the public in case of natural disasters, death or building collapse.

6. Healthcare Professional Indemnity Insurance

Under the NHIS Act 1999

All medical professionals, institutions and centers are required under law to buy this insurance policy.

The institution is to register under the National Health Insurance Scheme (NHIS) and compensation is provided under this scheme to NHIS patients for omissions or commissions of medical practitioners/institute,also for partial/permanent disabilities, sickness and injury.

Failure to comply will result in the revocation of the permit of the medical institution,also the offender will be prosecuted for involuntary murder.  



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