Insurance consumers embrace no premium no cover

Chuks Udo Okonta The Insurance Consumers Association of Nigeria (INSCAN) has thrown it support to the No Premium No cover policy that commenced January 1, this year. The initiative is one of the measures adopted by the National Insurance Commission (NAICOM)to boost the income of the insurance industry through prompt payment of premium. A statement by its President Rear. Admiral Isaac Areola (rtd), said the association is in total support of the enforcement of section 50 (1) and (2) of the Insurance Act 2003 NAICOM with effect from 1st January 2013 as the provisions relate to the Insured, the Underwriting Companies and the Insurance Brokers. He enjoined the insurance industry to consequently establish the “Premium Financing” concept as a line of business in the manner it obtains in other jurisdictions to solve the problem associated with premium payment. He said: "That after an emergency meeting of the National Executive, the State Chairmen and Coordinators of our Association at our National Secretariat (172, Herbert Macaulay Street, Ebute – Meta, Lagos) on Monday January 14th, 2013, the general public and our teaming members nation-wide are hereby informed of our following resolutions regarding the enforcement of sec. 50 (1) and (2) of the Insurance Act 2003 by the Nigeria Insurance industry:- "That our Association is in total support of the enforcement of section 50 (1) and (2) of the Insurance Act 2003 by the National Insurance Commission (NAICOM) with effect from 1st January 2013 as the provisions relate to the Insured, the Underwriting Companies and the Insurance Brokers. We hereby enjoin the Nigeria Insurance industry to consequently establish the “Premium Financing” concept as a line of business in the manner it obtains in other jurisdictions to solve this very simple problem. "That an Insurance company will be justified to repudiate any claim as from the aforementioned date on which no premium has been paid except as provided in Sec 69 of the Insurance Act 2003 regarding Third Party Liability Claims. "That an insured person need not pay the total annum premium debited at the inception of cover but the Insurance Company will be justified to pro-rate its cover to the extent to which the deposit premium is able to carry the risk." He noted that insurance companies should recognize the fact that the effective date of the enforcement is 1st January 2013 and that the association expects fairness,equity and good business relationship to prevail on all covers binded up to 31st December 2012 and thereafter. "That unless the “No Premium No Cover” provision was endorsed on any policy document being the evidence of the contract relating to a claim before 1st January 2013 or any other endorsement to that effect, our Association will presume non – disclosure of a material fact on the part of any Underwriter wishing to repudiate any legitimate claims on basis of this provision and we shall explore all legitimate means to pursue our members claims to logical conclusions. "That we hereby enjoin all Insurance Brokers in Nigeria to comply strictly with the provisions of sec. 41 (1) of the Insurance Act 2003 as regards remittance of premiums so that the interest of the Insurance Consumers will not be prejudiced before the underwriters," he said. He said the association also enjoin the insurance companies in to comply with sec. 70 (1) of the Insurance Act 2003 on payment of claims. He noted that the association is in support of all the recent reforms and initiatives of in pursuit of its main duty of protecting the interest of the insurance Consumers in Nigeria. The association is a non-governmental, non – profit organization of the Insurance Consumers registered with the main objectives of protecting the general interest of the Insurance Consumers in Nigeria, fostering unity and progress between the Insurance industry and the general public, creating awareness in the country as to the importance of Insurance and standing in the middle between the Insurance companies and the insured whenever there is dispute for amicable resolution visa– a- vis compensation.