Third party car insurance is easily the most popular class of insurance in Nigeria and is therefore the most commonly faked type of insurance. The high demand for it makes sure of that. The explanation for this demand is simple – In Nigeria, all road users operating any vehicle on any of the roads in the country must have motor insurance to protect themselves and other road users in case of an accident –as required by the aw of the country. Third party car insurance is the lowest class of insurance that fulfills this obligation and as such, it is the most common choice among drivers and vehicle owners to avoid getting in trouble with law enforcement and meeting the minimum requirement of the Law.
Now how do you avoid fake policies when you’re in the market for this policy or for any other car insurance policy in Nigeria for that matter – the easy answer is to use the Nigerian Insurance Industry Database
In this article, we would examine the essence of third party motor insurance, how to use the NIID portal and other things to be aware of (that would help you spot a fake) so u can make sure that if you’re putting your hard earned naira to buy car insurance, you get what you paid for.
WHAT IS THIRD PARTY CAR INSURANCE AND WHY YOU NEED IT?
To begin, we must first answer this glaring question, for the benefit of readers who don’t already know. Simply put, third party insurance is a type of insurance cover that provides the insured (you, the buyer of the insurance policy) with the necessary funds required to cover the costs of remunerating and/or treating an affected third party (a person other than yourself) in the case of a mishap arising from use of whatever you have insured.
So third party car insurance is an insurance policy that pays for the cost of repairing the damage to a third party’s car or any other property and/or the cost of covering a third party’s medical expenses in the event of an accident
ALTERNATIVES TO THIRD PARTY CAR INSURANCE
If you’re looking to avoid buying fake motor insurance policies, it is a good idea to know of the other types of motor insurance policies available to you as these are not as common, have a bit longer process of purchase, more benefits and are therefore not appealing to the people who make a trade of selling fake insurance policies
The first and most popular alternative to third party motor insurance is comprehensive motor. The straightforward explanation of a comprehensive motor insurance policy is that this is a type of motor insurance policy that in the event of an accident, covers the cost of repair to damage done to one’s own self and/or property as well to the damage done to a third party and/or a third party’s property> Comprehensive motor insurance typically comes in many variants with many price tags with the most common way of determining the cost of the policy being by deriving it from the estimated value of the vehicle insured.
Other than third party and comprehensive motor insurance policies. There are bespoke product that are created to offer either a little more than the scope of coverage/benefits a third party policy would give you for a slightly higher price OR a little bit less than the scope of coverage benefits a full comprehensive motor insurance policy would give you for a little bit less. These products are aptly and most commonly named Third Party Plus or Limited Comprehensive.
These policies have a relatively lower probability of being forged and might be a safer and more
COST OF THIRD PARTY MOTOR INSURANCE IN NIGERIA & DURATION OF COVER
The average cost of third party motor insurance in Nigeria is typically between five to six thousand naira. (N5,000 to N6,000). An annual payment made once at any time during the year and the coverage lasts for 12 months effective from the date of completion of purchase.
By the directive of the chief regulatory body of insurance in Nigeria, NAICOM (National Insurance Commission), third party motor insurance cannot be sold for less than N5,000. However it is important to note that some insurance service vendors have been known to sell third party motor insurance policies for less than the approved mount while others sell a few thousands higher than the known average
CHEAP VS FAKE CAR INSURANCE IN NIGERIA
If it is too good to be true, it usually is.
As mentioned in the last section, the cheapest compliant price for third party motor insurance is N5000. So if you’re being offered third party motor insurance for less than this price, your nose should begin to twitch because that is a rat smelling – even though you can buy for less than N5000 (as the competition in the market between the policy providers forces them to undercut themselves and sell for less), it is usually at the less than N5000 price point that the fraudsters operate so as to attract unsuspecting Nigerians looking for a bargain.
Fakers aren’t just roadside touts on the hustle. Insurance company staff that sell you car insurance policies at cheaper rates but don’t upload it to the NIID database and therefore makes the policy invalid are also selling you a fake. We will speak about the NIID database later in the article
SPOTTING A FAKE
There are two popular gimmicks employed by the peddlers of fake insurance products in Nigeria to deceive unsuspecting buyers and knowing them is the first step in ensuring you don’t fall prey.
FICTIONAL POLICY DOCUMENT
One common way fraudsters hawk their policies is through the use of policy documentation from non-existing insurance companies. According to NAICOM, There are 28 registered General Business Insurance Companies in Nigeria (General Business Insurance Companies are the ones that are capable of giving out car insurance policies). These companies are listed and regularly updated here: https://www.naicom.gov.ng/index.php/insurance-industry/insurance-companies/non-life
As a general rule, if your policy certificate isn’t coming from any of these companies, chances are you’ve bought a fake.
REAL POLICY DOCUMENT; FICTIONAL POLICY NUMBER
The next gimmick takes things a step further. Here you are issued a certificate that appears to be from a real insurance company but with a fake policy number.
Through the use of Photoshop and other media editing tools, an original policy certificate is manipulated such that they can replace the original policy holder’s name with yours but when the policy number is queried – your name and car won’t show up because that policy belongs to someone else.
There are other gimmicks and their methods are constantly improving. However, whatever the method used, the sure proof way of detecting it is using the NIID portal
In a bid to curb the excesses of fake insurance peddlers in Nigeria, stake holders under the umbrella of the NIID have developed a portal hosted at http://www.askniid.org. Where all insurance companies and agents are required by law to upload the details of any insurance policy issued for record keeping and authentication. Therefore, any insurance policy that you buy and cannot verify on the NIID portal is not authentic – even if you’ve bought it from an insurance company.
HOW TO USE THE NIID PORTAL
Using this platform is very easy and you can authenticate your policy in a few short steps:
- From any web enabled device, visit http://www.askniid.org. YOUR BROWSER should take you to a page to that NIID portal where you can verify your insurance policy
- On the askniid portal home page, look in the header or body of the page for the “Check Policy” button as shown below and click on it
- You’d be asked if you want to check for a vehicle policy or a marine policy. Select vehicle policy as shown below and you’d be ready
- You can then either enter your car insurance policy number or your car registration number and then click ‘search’ to see if you have an authentic policy
- If your policy is authentic, the details of your insurance policy would be returned back, informing you that you have an active policy as shown (the sensitive details for this search has been blurred out for privacy reasons)
- if you have a fake insurance policy or your vehicle does not have insurance, your search will return a result as shown below to notify you
MAKING SURE YOU AREN’T A VICTIM AND WHY YOU SHOULD BE VIGILANT
When it comes to third party motor insurance policies, there are majorly two reasons why you want to make sure you’re buying an authentic product, The first of those being that you want to make sure you are in compliance with the laws of the country, such that if at any point you are stopped at any of the numerous checkpoints that the Nigerian roads are decorated by, you are able to provide valid papers. The second and the probably the most valid is to be sure that if something happens (God forbid, because you’re Nigerian and you know better than to not denounce this immediately), you’re not left hanging dry. In the event of an accident or any other mishap, the purpose of insurance is to help you cover the cost of damages to vehicle, hospital treatments etc. You will only have access to this if you have ensured you are not a victim of fake insurance policy peddlers.