In the insurance act of 2003, there are penalties: one-year imprisonment and a fine of N250,000. Enforcement has not been what we expect,” he added.
The Nigeria Insurers Industry Database (NIID) has so far captured an estimated 1.8 million vehicle registrations in 2019, out of 12 million automobiles said to ply Nigerian roads.
According to the Nigeria Insurers Association (NIA), 2.53 million vehicles were in the database as of October 2, 2019.
In February 2018, Eddie Efekoha, chairman of NIA, said there were 4.5 million cars in NIID out of a projected 12.5 million vehicles on Nigerian roads.
This indicates a drop in the number of insured vehicles on the country’s not-so-smooth road network. Soji
Oni, Senior Manager Technical at the association told SaharaReporters in an interview that ineffective enforcement of the Insurance Act of 2003, was the reason for the low rate of genuine insurance covers in the country.
“An estimate of 1.8 million cars have been registered on NIID this year,” Oni said.
“Enforcement lies with the government. In the insurance act of 2003, there are penalties: one-year imprisonment and a fine of N250,000. Enforcement has not been what we expect,” he added.
The body of insurance firms started a campaign on October 2, called ‘waitin you carry,’ in a bid to sensitize Nigerians on the need to stop using the services of dupe insurance agents.
"At times we see people who do not have insurance at all. Then we have some people who really have but they patronize touts or they patronize people who give them fake insurance,” he said.
Oni explained that the government made the ‘third party’ insurance cover mandatory, to ensure victims of accidents are duly compensated.
“The third-party insurance is compulsory, to make sure there are funds to cater to innocent victims. If you carry fake insurance, how do we make funds available for compensation?” Oni said.
He said Nigerians pay as low as N500 to acquire worthless insurance policies from crooks.
He explained that the minimum third party insurance cover available on an annual basis for private vehicles is N5,000.
“The third party for private is N5,000 but some people are selling this for N1,500, N500.”
According to him, the practice has been dealt a knockout punch with the introduction of the NIA powered *565*11# USSD code in January of this year.
He added, “You know, that avenue has been paralyzed, the law enforcers on the road use NIID. So if you patronize a tout, how does your car get on NIID? If it is not on NIID, there’s no mistake.”
However, Oni added that 2019 was the most productive year in the purchase of third party insurance policies.