Insurers, motorists disagree over proposed N20,000 on third party policy

Motorists in Nigeria are vehemently opposed to the proposal to increase Third Party Motor Insurance policy from the current N5,000 premium to N20,000, above workers’ minimum wage, The Guardian has learnt.

The proposed increase is coming at a time Nigerians are still battling with recession that has led to drastic cut in disposable income of the people, as they struggle to cope with double-digit inflation and Naira devaluation that have made some cut down their insurance budget.

The attendant result if passed into law is further impoverishment of Nigerians, as the burden will be transferred to commuters, who would have to pay much more to get to their various destinations. This will skyrocket the prices of goods and services, and pushing inflation even much higher.

Furthermore, the proposal is coming at a time when the minimum wage in Nigeria is currently at N18,000 per month, with many state governments still unable to pay this amount even after many years of implementation and many still owing workers for months from the little they pay.

Labour is already threatening a show down with government if by May, it has not agreed to pay a new minimum monthly of N56,000 to reflect current economic realities.

A Senator from Katsina Central, Umaru Kurfi had proposed a bill in the National Assembly (NASS) seeking to increase third party insurance premium to N20,000. The bill has undergone the first and second reading and has been referred to Senate Committee on Banking, Insurance and Other Financial Institutions.

When the proposed premium is finally passed into law, vehicle owners would be made to pay 300 per cent higher than what they are paying now, a development motorists frown at.

Findings by The Guardian around some bus terminals within the Lagos metropolis and other parts of the country at the weekend suggested that vehicle owners are not happy with the proposed premium increment

Motorists, especially, the commercial bus drivers, were furious with government for such an agenda, saying the plan was taken without the interest of Nigerians at heart.

Although insurance operators are excited about the proposal, but their prospective customers (motorists) are opposed to it and are therefore calling on the appropriate authorities to come to their rescue.