The Nigeria Employers Consultative Association, NECA, has rejected the recent hike in Third Party Motor insurance by the National Insurance Commission (NAICOM), from N5000 to N15,000.
Also, the National Union of Banks, Insurance and Financial Institutions, Employees (NUBIFIE) and Campaign for Democratic Workers’ Rights, CDWR, have kicked against the increments.
Speaking with Vanguard, Director-General of NECA, Wale-Smatt Oyerinde, said: “While the commission reserves the right as provided in the extant law in reviewing the rate, the timing in view of current economic realities is of concern.
”It is worthy of note that the current rate has been in existence for over five years, while the costs of motor vehicles have increased exponentially.
“Coupled with the general price increase of goods and services, the commission could be justified if there are guarantees for improved service delivery and a higher response rate from insurance companies.
“In developed climes, the insurance industry plays a major role in national development as it serves as risk off-takers in cases of accidents and other mishaps. But with the low rate of insurance awareness in the country, we urge NAICOM to deepen engagement with critical stakeholders in order to promote the insurance culture in Nigeria and also get buy-ins for its policy actions”.
Similarly, General Secretary of NUBIFIE, Shiek Muhammed, said: “The issue of insurance itself has not taken grassroots acceptability in Nigeria and if we need to deepen insurance coverage to the grassroots, raising the additional cost of insurance will be a disincentive for people to insure. Convincing people to insure their property and renew same is very difficult, let alone asking them to pay N15,000 for third-party motor insurance.
“NAICOM is creating room for fraud and corruption for motorists and policemen because even at N5,000, people try to circumvent it.
“We believe the commission should pay more attention to sensitizing Nigerians about insurance.
”There should be more public awareness on the importance of insurance. Government and its agencies should focus their time on creating awareness and public acceptability before monetary issues”.
On its part, a civil society group, which is in partnership with the Nigeria Labour Congress (NLC), the CDWR, through its National Chairman, Rufus, Olusesan, said: “The recent increase in the third party motor insurance premium from N5,000 to N15,000 by NAICOM, which is 200 per cent increment, shows the insensitivity, senselessness and self-serving …
”Of course, the increase shows how government doesn’t care about the plight of drivers, commuters and other road users.
“For instance, prices of spare parts have gone up by 70 per cent, petrol price has gone up by 80 per cent. Most roads in the country are in deplorable conditions, which lead to frequent breakdowns, and repairs of vehicles, with inflation at 23.4 per cent, the highest in the last 17 years, according to the National Bureau of Statistics, NBS, a government agency.
“For those in transport business, they will push the increment to commuters, mostly workers, artisans, market men and women, etc., who will bear the fang by paying transport fares through their noses without a commensurate increase in salary to cater for this harsh and needless increase.
“We are calling on NAICOM to jettison this obnoxious policy before it causes civil unrest in the country. We have had enough crises for the working masses. Therefore, we call on Nigeria Labour Congress, NLC, Trade Union Congress of Nigeria, TUC and Joint Action Front, JAF, to mobilize against this move. At CDWR, we shall organize a mass protest against this anti-people policy.”
