Motorists besiege insurers for claims

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Chuks Udo Okonta

The third party motor insurance campaign being executed by the insurance industry is gaining traction as motorists that hitherto never believed in claims payment are now besieging underwriters for claims on issues they used to over looked in the past.

Inspenonline gathered that motorists are presently making claims on what they had considered minor and fixing them in past without recourse to their insurers.

The Managing Director Universal Insurance Plc Ben Ujoatuonu, told Inspenonline that motor insurance claims has increased going by the massive education and awareness being conducted by the industry.

Asked if the reduction of vehicles on the road due to increase in fuel, which is as a result of subsidy removal, has any impact on claims, he submitted that there may be that assumption, but it can’t be measured, stating that, that can only be measured based on statistical data.

Deputy General Manager, Corporate Communications & Investor Relations, Sovereign Trust Insurance Plc, Segun Bankole, said there has been a surge in presentations of motor claims that were before now handled by motorists.

According to him, because of the increase in premium and education received by motorists, they come for claims no matter how little the accident or incident is.

The National Insurance Commission (NAICOM) in its determination to create more value for motorists had on January 1, 2023, increased premium of private third party motor insurance policy from N5,000 to N15,000 and Third Party Property Damage (TPPD) limit from N1 million to N3 million.

The approval was contained in a circular entitled; New Premium Rate for Motor Insurance: numbered: NAICOM/DPR/CIR/46/2022, dated; December 22, 2022; signed by the Director, Policy and Regulation, NAICOM, Leo Akah for the Commissioner for Insurance Sunday Thomas and sent to all insurance Institutions.

NAICOM stated that pursuant to the exercise of its functional of approving rates of insurance premium under Section 7 of NAICOM Act 1997 and other extant laws, the commission hereby issued this circular on the new motor insurance premium rates effective from January 1, 2023.

NAICOM pegged N3 million Third Party Property Damage (TPPD) limit for private motor; N5 million limit for own goods, with premium of N20,000; staff bus premium, N20,000 and TPPD, N3 million.

For commercial vehicles, trucks/general cartage has TPPD limit of N5 million, premium N100,000; special types, TPPD limit of N3 million, premium N20,000; tricycle, TPPD limit N2 million, premium N5000 and motorcycle, TPPD limit N1 million; premium N3000.

The insurance industry regulator submitted that comprehensive motor insurance policy premium rate shall not be less than five per cent of the sum insured after all rebates or discounts.

Speaking on the value created by the new premium and claims regime, the former Executive Secretary, Nigerian Council of Registered Insurance Brokers (NCRIB) Fatai Adegbenro, said the action taken by the National Insurance Commission would be beneficial to all the stakeholders, adding that as the costs of vehicles and repairs have gone up astronomically as a result of inflation, there is the need to have higher limits of third party limits of liability.

He maintained that failure to do this might pose a great danger and embarrassment to all the stakeholders as the primary purpose of making the third party motor insurance compulsory may be defeated.

Adegbenro submitted that it is part of the primary responsibilities of NAICOM to protect the policyholders and the public that may suffer loss or damage.

“It is a step in the right direction that everyone should embrace and support.
If a motorist who cannot afford an extra ten thousand premium incurred a liability of N1.7 million or N2 million plus and the old policy limit was N1 million. How is such a negligent motorist able to raise the difference of either N700k or N1 million plus?” he enquired.

He wondered what would be the fate of the third party that has suffered the loss or damage if the negligent motorist cannot afford the extra payment to make good the lose suffered?

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