Sanctions Await Insurers Rate-cutting Motor Insurance – NIA

The Nigerian Insurers Association (NIA) has threatened to institute disciplinary action against any insurer who rate-cut the Third party motor insurance rate which has been increased from N5,000 to N15,000.

It disclosed that it has received reports that some insurance companies are selling motor insurance policy below approved rates, promising to report such defaulters to the National Insurance Commission (NAICOM).

In a circular, signed by the director general of NIA, Mrs. Yetunde Ilori, titled, NIA.MTPC/YI/23, ‘Adherence To The Approved Rates For motor Insurance’, dated; May 24, 2023 and sent to all Chief Executive Officers General Insurance Companies, a copy of which was made available to LEADERSHIP yesterday, noted that, following the decision reached at the 2023 CEOs retreat in respect of the need to implement the new premium rates on motor insurance, it has become pertinent for the association to reiterate the need for companies to sell motor insurance policies at the approved rates.

She stated that secretariat has received reports that some companies are selling below the approved rates, stressing that, this does not augur well for growth of the market even as it brings serious reputation issues to the industry.

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Disclosing that the governing council of the body is displeased with the activities of agents within licensing offices engaged by member companies to sell third party motor insurance at reduced rates and other such arrangements, Ilori, in the circular, stressed that NIA would not hesitate to report defaulting companies to NAICOM.