Why you need a car insurance in Nigeria, and how to buy one

06/20/2018

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This article will guide you step by step on how to make your first car insurance purchase.

Many people here in Nigeria think that an insurance for their automobile is unnecessary and a waste of money, therefore abandon the idea of buying one.

However, insurance certificates are required by the law and thus all owners of the following vehicles must possess one: cars, public transports, motorcycles, tractors, road rollers, excavators, etc. Even if it wasn't demanded by law, buying a car insurance is always advisable for all drivers to have one, since it covers a huge amount of cost which might occur in the event of an accident.

a line of text of car insurance

Do thorough research before purchasing your first insurance

Below is a guide on how to get an insurance certificate in Nigeria: 

A. Contact Insurance Companies in Nigeria

You can simply open your browser and go to the website of National Insurance Commission (NAICOM) by this address: naicom.gov.ng. This is the official website of the regulatory agency for insurance companies in Nigeria

Some of these companies include:

  • Zenith Insurance Plc
  • FBN General Insurance
  • Cornerstone Insurance
  • AXA Mansard Insurance Plc
  • Leadway Assurance Plc
  • AIICO Insurance Plc
  • Consolidated Hallmark Insurance
  • Old Mutual Nigeria

B. Choose a Type 

After you are done with your research and get a list of insurance companies, start making phone calls or pay some of them a visit. 

The next step is to fill in some forms:

  • KYC Form
  • Motor Proposal Form
  • Motor Insurance Physical Inspection Form

There will be 2 types of car policies in those forms:

Third Party Auto Insurance

This is mandatory in the law and also the number one choice for most Nigerian. They are often called "Police please let me go". It will cover damage to the drivers, damage to the property of a third party and even death.

C. Depends on the type of vehicles, owners have to pay a fee of N5000 to N10,000 per annum

Comprehensive Auto Insurance

This type of insurance is not required by law. Still, it will cover all risks related to the vehicle and the owner of the vehicle

The risks are defined as loss or damage to the vehicle due to fire, vandalism, accidents, theft or unintentional damage. It also covers the legal liability for death, injury or destruction of the property of third parties resulting from the misuse of insured vehicles.

D. Comprehensive insurance often cost between 4 to 5% of the total value of the vehicle, for a one-year period

Some authorized dealers with pre-established relationships with insurance companies may offer you the comprehensive auto insurance along with the car as an option. Some might give an option of installing a tracking device in your vehicle, with starting price of N2,500,000.
Once you have finished paying the fee, the insurance company will issue you a certificate which contains details about your policy.

But it's not over yet. You will have to use the details in your policy to approve the validity of your certificate online. Go to website www.askniid.org and wait to be instructed. Normally you would enter your insurance number and/or vehicle registration plate number and hit the search button. If your insurance policy is authentic, details about your car and insurance certificate will appear. If it isn't, your information is not yet inputted into the system, meaning your insurance is probably fake 

Although the law only requires one type of third-party insurance, a comprehensive insurance is a worthwhile investment for your rainy days.

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