Third-party insurance: IEI tells operators to incentivise motorists
International Energy Insurance has urged operators to make the third-party motor insurance more attractive to motorists following its enforcement on February 1, 2025.
According to a statement made available to The PUNCH recently, IEI said it is important to ensure motorists have a valid policy to avoid running afoul of the law.
Earlier in January, the Inspector-General of Police, Kayode Egbetokun, announced nationwide enforcement of third-party motor insurance from February 1, 2025. Section 68 of the Insurance Act and Section 312 of the 1945 Motor Vehicle (Third Party Insurance) Act mandated all vehicle owners to possess third-party insurance before operating their vehicles on public roads.
Speaking on the enforcement, the Managing Director/Chief Executive Officer of IEI, Mr Olasupo Sogelola, urged Nigerians who already have a valid policy and suffer damage or injury from accidents to always reach out to their insurance companies to make a claim.
He went on to applaud Egbetokun for the enforcement of the policy, noting that it will generally improve insurance acceptability and deepen penetration in the industry.
He, however, said insurance operators need to look into how they can continuously ensure that the third-party motor policy is made available and the distribution model is properly followed through because they will not always have the police enforcing third-party insurance.
He said, “We as operators need to find a way of attracting people to third-party motor insurance. Beyond saying we will pay your claim, we must do things that will make people naturally want to buy the policy. So, we need to start to look at upscaling and improving third parties and looking at what more we can do. We need to make it available and ensure that they are variants. There are so many things that go with it, like incentives and whatever, to retain and maintain all the people that will be buying.
“This is because, apart from police enforcing third-party, we must be prepared to give what is right, and that is to make sure that claims are paid promptly on every third party, knowing full well that with the volume that is expected, the claims ratio is still very low. We need to do more than just clap for the police. The police will do it by doing their best, but after this first year, how do we ensure that we continuously get it right? This is the question we need to ask ourselves and find lasting answers to. We cannot run to the police every year to come and help us to enforce the third party. Beyond enforcement, we have to look at our distribution models.”
Advising motorists on claims, he said, “When people have third-party claims, they should ensure they look at their policy or certificates to find a link on how to report claims or telephone numbers to make calls and report the claims.
More importantly, people should be honest about claims and not just come up with fictitious claims looking for somebody who’s going to spray their cars for them. Usually, third-party claims are on the low severity claims level, with few of them as high severity claims where there is life or property damage. But where it is just a normal accident, there is usually low severity.
“However, experience has shown that people also want to find a way of adding more to their claims, and this can discourage an insurance company from paying such a claim.”
Sogelola pointed out that IEI makes payment of genuine claims below N200,000 within 24 hours.
He stressed that as an insurance company, they are in the business to pay claims, and they will do this all the time.
“We have put this to the test, and it has worked for us since we came back into the market, and we believe that everybody selling third party should also be able to make this available,” he added.
