Motor Insurance Increase: Reverse policy or face legal action, law firm writes NAICOM - NEWS FRONTIER DAILY


Thursday, December 29, 2022

Motor Insurance Increase: Reverse policy or face legal action, law firm writes NAICOM

The Chambers of Evans Ufeli has given the Chairman of the National Insurance Commission, (NAICOM) five days to reverse the 200 percent motor insurance increment or face legal action.

In a pre-action notice dated December 29, 2022, and addressed to the commission, the law firm said the new NAICOM policy amounts to economic torture, targeted at putting Nigerians under dehumanizing conditions and that the constitution forbids such policy.

The notice signed by Evans Ufeli reads: "We are Public Interest Solicitors and advocates for good governance. We stumbled on a circular from your commission dated December 22, 2022, and signed by the Director, Policy & Regulation, Mr. Leonard Akah with reference number NAICOM/DPR/CIR/46/2022, released to the public by your office, wherein the commission stated that the cost of insurance on all classes of motor insurance, including motorcycles, have been reviewed upwards.

"According to your commission, the third-party premium insurance rate for motorists will now be N15, 000 as against the N5,000 it was before your new policy. Sequel to the above, you have also raised claims for motorists to N3m in the event of an accident, and that for commercial truck/general cartage will now give the policyholders N5m claims in the event of an accident.

"Given the foregoing, the new policy by implication will mean that the industry operators have increased the cost of the policy under reference by 200 percent, following the addition of N10, 000 to the cheapest third party which currently stands at N5,000.

"Furthermore, according to the aforementioned circular, you alluded to the fact that you are empowered to approve the new rates for motor insurance premiums by Section 7 of the NAICOM Act 1997 and other extant laws, noting that the new motor insurance premium rates become effective from January 1, 2023. Be that as it may, we wish to respond as follows.

"That the law that established your commission did not empower you to be insensitive to the plight of the masses, to take such outrageous decisions in times of economic depression like we have today. It therefore not a well-thought-out policy as same is riddled with avarice and a gross display of ambivalence.

"That by the provisions of the 1999 constitution as amended(which is a superior legislation to the law establishing the commission)", sovereignty belongs to the people" and their rights, not to be subjected to torture and undue socio-economic hardship is guaranteed and protected by the law under reference. Your policy, therefore, amounts to economic torture, targeted at putting Nigerians under dehumanizing conditions and the constitution forbids the same.

"We reject the increments just made by the commission and affirm that the NAICOM Act did not empower the commission to fix rates for insurance premiums in isolation of the socio-economic condition of the Nigerian state. You must reappraise the law in your interest, knowing that every policy must conform to socio-economic variables before the same can pass the test of time.

"That, it is against public policy to ambush Nigerians with such policy at a time when the same government has grounded the nation's economy and has failed to restart it for the benefit of the masses.

"That, on behalf of Nigerians, we call for a total reversal of the policy to the status quo and we hereby give you five (5) working days to do that, failing which, we shall have no other options than to proceed against you in the court of law for redress. Take notice that this letter serves on you as a Pre-action Notice and same shall be enforced in due course."

Source: Vanguard 

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