The National Insurance Commission (NAICOM), Nigeria’s apex insurance regulatory body, has issued a stern public alert cautioning Nigerians against the rising activities of illegal third-party motor insurance operators.
In a detailed press release dated February 19, 2025, NAICOM highlighted the deceptive practices of certain entities, including the National Cooperative Insurance Society of Nigeria (NCIS), which have been masquerading as legitimate insurers to defraud the public through unauthorized sales and underwriting of third-party motor insurance.
This illegal activity, described as both criminal and contrary to public interest, has prompted NAICOM to take decisive action to protect policyholders and enforce regulatory standards.
The commission’s warning comes in the wake of an ongoing enforcement exercise by the Nigeria Police Force and the Federal Road Safety Corps, which began on February 1, 2025.
This initiative targets all vehicles on Nigerian roads to ensure compliance with the mandatory Third Party Motor Insurance, a legal requirement designed to safeguard road users.
NAICOM emphasized that only licensed insurance companies, authorized under the NAICOM Act 1997 and the Insurance Act 2003, are legally empowered to offer and underwrite various classes of insurance, including the compulsory Third Party Motor Insurance, to the public in Nigeria.
This legal framework underscores NAICOM’s authority and responsibility to regulate the insurance sector and protect consumers from fraudulent schemes.
In its alert, NAICOM specifically called out the National Cooperative Insurance Society of Nigeria (NCIS) for its misleading claims.
NCIS announced that its motor vehicle insurance transactions were valid and not subject to government intervention beyond what is stipulated by law.
NAICOM, however, labeled this statement as illegal, misleading, and deserving of public disregard. The commission clarified that NCIS is not a licensed insurance company and, therefore, lacks the legal authority to sell or underwrite the compulsory Third Party Motor Insurance.
NAICOM warned that any third-party motor insurance policies issued by NCIS or its affiliates are illegal, urging Nigerians to exercise caution and avoid falling victim to such schemes.
NAICOM’s determination to combat these fraudulent activities is unwavering. The regulator stated its commitment to flushing out illegal and fake operators who are bent on defrauding, deceiving, and misleading the public for selfish financial gain.
The commission has threatened legal action against NCIS, vowing to prosecute the entity if it does not immediately cease its illegal operations, which violate public policy and the broader interest of Nigerians.
This crackdown reflects NAICOM’s resolve to maintain the integrity of the insurance industry and protect consumers from financial exploitation.
To reassure the public, NAICOM reiterated its dedication to ensuring that policyholders and legitimate beneficiaries of insurance policies enjoy the full benefits of their coverage.
Licensed insurance companies authorized by NAICOM provide maximum benefits under the Third Party Motor Insurance, including up to N3 million in third-party property damage coverage, medical treatment for bodily injuries, and compensation for deaths.
These benefits, NAICOM emphasized, can only be guaranteed by insurance companies licensed by the commission, reinforcing the importance of dealing with authorized entities.
The commission also reminded Nigerians of its previously circulated list of licensed and authorized insurance companies permitted to sell or underwrite mandatory third-party motor insurance in Nigeria.
This list is readily available on NAICOM’s official website, www.naicom.gov.ng, providing a reliable resource for the public to verify the legitimacy of insurance providers. By making this information accessible, NAICOM aims to empower Nigerians to make informed decisions and avoid fraudulent operators.
NAICOM urged all Nigerians to take note of its warning and steer clear of any third-party motor insurance policies offered by unlicensed entities like NCIS or its affiliates.
The commission’s press release, signed by its management, serves as a critical reminder of the risks associated with illegal insurance schemes and the importance of adhering to regulatory standards.
As enforcement efforts continue across the country, NAICOM remains committed to safeguarding the insurance sector and ensuring the financial security of Nigerian road users in 2025.
