What to know when buying vehicle insurance in Nigeria

Many Nigerians shy away from buying car insurance as they consider it to be an unnecessary expense. However, insurance is actually compulsory by law, and serves as invaluable protection much like any other insurance.  It’s not just about the legality though; much like Cartrack’s superior vehicle recovery gives you peace of mind, auto insurance lessens the worry that theft or an accident could ruin you financially.

Insurance is designed to put you back in to the same position you were in before the loss or damage occurred. This is done either financially, where you receive an amount equivalent to the cost of the asset, or the asset itself is replaced or repaired.

When deciding whether to take insurance or not, consider this: if your car was damaged beyond repair, could you afford to replace it? And while you’re thinking about that, here’s what you need to know when buying car insurance.

 It’s important to conduct proper research

Googling Nigerian car insurance will help you learn more about the various vehicle insurance companies.  For a comprehensive overview of the registered companies check the National Insurance Commission at naicom.gov.ng., which is the website for the regulatory agency for insurance companies in Nigeria –(NAICOM).

Some of these companies include:

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

 Choose the best fit for you

 Once you’ve done your research, you’ll have to determine which insurance company best serves your needs. Some of the factors that you should consider are:

  • How much cover do you require?
  • Which insurance company offers the best returns over the long run?
  • Is the company reputable and what is its track record like?
  • Is there a money back option for you when you don’t claim?
  • Are you able to combine options, such as car and bike insurance?
  • Do you get a discount if you take vehicle, home and buildings insurance?
  • Are they able to provide vehicle tracking and telematics and discounts on premiums?

Get busy with the admin

Before taking out the insurance, you will have to complete a:

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

When filling out these forms, you will be offered two types of car policies:

  • Third Party cover

As this type of insurance is compulsory in Nigeria, it is the most popular one, covering injury from accidents, death and damage to property that does not belong to you.  Depending on the type of vehicle you have, you could be charged an annual premium of between N5,000 and N10,000.

  • Comprehensive Insurance

As the name suggests, comprehensive insurance covers all risks related to owning and driving a vehicle. However, this policy is not compulsory, but it is a good option if you have a new car, or a car you are still paying for.  This policy includes covers loss or damage to insured vehicles resulting from:

  • A collision
  • Theft
  • Fire
  • Vandalism
  • Accidental damage

There is also legal liability for:

  • Injury to yourself or passengers
  • Death
  • Damage to the third parties’ property

 Check whether your policy is authentic

Once you have an insurance policy, your insurance company will give you a certificate that contains details about your policy. However, you need to confirm the authenticity of this policy first – you can do this by visiting www.askniid.org and following the instructions as advised. If your policy is fake, no information will appear once you have entered your policy number, vehicle number and vehicle type.

Tracking with Cartrack

As an extra precaution, some insurance companies will also offer vehicle owners tracking devices that can cost N2,500,000 and above. Cartrack offers leading vehicle recovery services, with our superior technology and services ensuring that our dedicated team can offer you peace of mind around-the-clock. Contact us today to enjoy our world-class offering.