Group life: No cover for FG workers from September to date

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Chuks Udo Okonta

Going by the ‘No Premium No Cover’ law Federal Government workers in Ministries, Department and Agencies (MDAs), paramilitary and intelligence agencies, presently have no cover, in spite the recently approved N9.24 billion for the purpose.

Findings by Inspenonline revealed that the 2021/2022 group life premium paid by the Federal Government elapsed in September 2022, an indication that workers have being without any cover from October 1 to date.

Life insurance operators interviewed on the matter told this medium that they would only grant cover when premium is paid, which is in line with the ‘No Premium No Cover’ law enacted by the government.

Whilst they commended government for the payment, they implored it to follow the timeline by ensuring premium is paid before the due date.

They also demanded that government should priorities insurance of non-life assets, stressing that present situation where most government non-life assets are not covered by insurance is not good for the economy as Insurance remains best tool to mitigate risks.

Recall that the Federal Executive Council, on Wednesday this week, approved N9.24 billion for Group Life Insurance Cover for civil servants for 2022 and 2023.

The group life insurance policy would provide cover for government officials in all Ministries Departments and Agencies (MDAs) paramilitary and intelligence agencies.

The Minister of Finance, Budget and National Planning, Dr. Zainab Ahmed, disclosed this to State House Correspondents after this week’s Council meeting, chaired by Vice President Yemi Osinbajo, at the Aso Rock Villa, Abuja.

According to Ahmed, the Head of the Civil Service of the Federation, Dr. Folashade Yemi-Esan, presented the memo to the council and approved insurance package will cover all government officials.

Section 50(1) of the Insurance Act 2003 states that, “The receipt of an insurance premium shall be a condition precedent to a valid contract of insurance and there shall be no cover in respect of an insurance risk unless the premium is paid in advance.” In the case of Ajaokuta Steel v Corporate Insurance (2004), the Court of Appeal pronounced on the provisions of section 50(1) of the Insurance Act and held that the no premium no cover condition was a condition precedent to the formation of a valid insurance contract. Therefore, failure of the insured to pay premium before the inception of the policy rendered the insurance contract null and void and unenforceable. That decision has now been affirmed by the Supreme Court in Corporate Insurance v Ajaokuta Steel,[1] Since 2004.

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