Nigeria Motor Insurance May Shift to Third-Party Cover, an Insurer Says
NIGERIA · FINANCE Key Facts —The country Nigeria has about 220 million people and one of Africa’s largest but thinnest insurance markets. —What was said An insurance executive expects more drivers to choose third-party cover over comprehensive policies. —The status This is a stated expectation, not a measured change in the market. —The money The […] The post Nigeria Motor Insurance May Shift to…
Nigeria's motor insurance landscape may evolve as an insurer predicts a shift toward third-party coverage. Katherine Itua, executive director for finance and investments at Consolidated Hallmark Insurance, expects rising fuel and running costs to drive customers toward more affordable third-party policies. Third-party cover, which pays for damage to other people's vehicles, is more economical than comprehensive policies, which cover the insured's vehicle.
The regulator sets a minimum annual premium of 15,000 naira (approximately US$11), a figure that has been in place since January 2023, up from 5,000 naira (around US$4) in 2023. Comprehensive coverage requires a minimum of 5% of the sum insured; for a car insured at 3 million naira (approximately US$2,260), this amounts to about 150,000 naira (around US$113).
Although the prediction is based on the expectations of one insurance executive, the gap between the minimum premiums and the actual cover prices suggests that a potential shift toward cheaper options is plausible. However, no data currently supports an actual transition from comprehensive to third-party coverage. The Nigerian Insurance Industry Reform Act, enacted on August 6, 2025, mandates a 60-day deadline for settling claims with interest penalties for late payment, along with creating a compensation fund for road accident victims.
These reforms aim to strengthen the insurance industry, though enforcement remains unclear, as no actions have been announced. Until regulatory changes show in claims data, the published minimum premium and advertised prices may continue to diverge.
Written by urgent.news from The Rio Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
