The National Insurance Commission (NAICOM), the nation’s insurance regulator has sealed pact with the Economic and Financial Crimes Commission (EFCC), to address deceitful activity of some insurance peddlers in the industry across Nigeria.

NAICOM does not have authority to indict offenders, but can only report suspicious activities to the EFCC. The Commissioner for Insurance, Mohammed Kari, who led a team to the EFCC Headquarters on a courtesy visit, said there is an urgent need for the anti-graft agency to beam its searchlight on the insurance sector, in order to consolidate on the gains achieved.

We need EFCC’s partnership in the areas of investigation, prosecution and calling erring operators to order, in line with the relevant laws, he added.

Giving insight into what has happened in the sector, he justified that NAICOM had received inquiries on some persons and companies from the EFCC, which were being acted upon.

In his response, the Acting Chairman of EFCC, Ibrahim Magu, affirmed to the NAICOM team that an Insurance Fraud Unit, exists in the EFCC, in realisation of the increasing cases of fraud being perpetrated in the insurance sector.

According to him, the EFCC needs the assistance of NAICOM to help its operatives further understand the insurance industry.

He further stressed that both organisations were working to achieve same purpose of sanitising the sector, and described the tasks ahead as very tough and challenging. We have come a long way and will continue together to fight the corruption menace, he said, and stressed the need to sensitise the public about insurance-related fraud.

Meanwhile, a data sourced from the Nigerian Insurers Association (NIA), showed that there are about 16 million vehicles on the roads across the country, with only eight million of them having 3rd party insurance cover.

This, however, leaves eight million vehicles either uninsured or parading fake insurance papers. The Third Party Vehicle Insurance comes at a fixed price of N5,000 for privately used saloons, sport utility vehicles (SUVs), while commercially used vehicles are charged N7,500.

The Guardian reliably gathered that in a bid to save the industry the huge losses, operators have now come up with a unified platform known as Nigerian Insurance Industry Portal (NIIP), for the sale of third party motor insurance.

The new portal, which is an initiative of NIA, and expected to be launched anytime soon will accommodate all NIA member companies, and serve as the authentic platform to sell third party motor insurance in Nigeria.

Speaking on the development, the new Director General of NIA, Yetunde Ilori, promised that her regime will ensure that the portal comes to fruition, in a bid to curb the activities of fake underwriters in the sector. She noted that when completed, the unified platform will integrate all existing legacy systems from individual companies.

Furthermore, most of the motorists carrying fake insurance papers do obtain them at some vehicle licensing offices, an agency that is under the purview of Vehicle Inspection Offices (VIOs), even as there are racketeers who market these fake covers to commercial vehicle drivers at the parks, garages and bus-stops.

The fake insurance papers, it was learnt, are being sold between N450 to N1,000, even though the papers carry names of insurance firms whose names are not registered with the industry’s regulator.

Most drivers go for fake insurance because it is cheap as well as to avoid the wrath of the law enforcement agents, as they have little or no knowledge of the benefits of buying original insurance cover. Other uninsured motorists, it was learnt, prefer to settle their way out with the law enforcers in case they meet them on the roads.

Section 38 of the National Insurance Act 2003, currently in use, states that Third Party motor Insurance is required as part of the minimum amount of auto cover you must carry as a car owner. Penalties for non-compliance can include a fine of up to N250,000 and/or 1-year imprisonment.

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