Insurable violence: What is and what it is not

VIOLENCE is an act nobody ever wants. This we see play out in our everyday life. Except in the instance, where a similar force is needed for the preservation of the status quo; peace and tranquillity. In the recent wake of civil agitation and uprising, in certain parts of the world. We have come to discover that, there are more question in our hearts than solutions in our hands. Questions like: how certain is our future? How intentional can a government be? How can I protect the lives and properties connected to me? To mention Insurance now! Is to provoke a slap from your neighbour. Whose reason would be ‘’to help you; focus on pressing issues and not on little things!! This scenario plays out, most times, when little details are over-looked in a picture; unknown to us, that a little drop of rain consistently for a day can cause a Dam to overflow.” Little by little, a little becomes a lot. This is the whole idea of Insurance little by little a financial Dam would be full. After which some of it, can be channeled for financial irrigation at the time of need.

There have been a lot of speculations and expectation, with the recent wake of protest and coupled with the vandalism that came with it. Does insurance cover protest? How much would insurers pay in a case my assets are vandalized? Who would help me in processing and negotiating my claim or case? While this questions, ring in our hearts. Let me also states that the job of an insurance broker cannot be over-emphasized. It is likened to how people need lawyers to represent them in court, although it can be done singlehandedly. No one would want to belabor himself with all the rudiments and legal jargons to defend him or herself in a court trial. When there someone who studied five for that purpose. Hence the role of an insurance broker should not just be seen as an intermediary alone. But a clear cut enterprise of technical distinction, that is quintessentially needed in the whole insurance process.

The Nigeria economy is a large one, as she boasts of large numbers under her belt. Large numbers usually infer a large market. Nevertheless, certain insurance companies are not still as buoyant in their reserves to settle claims at an almost immediate time frame. Hence they may still need to spread such sizeable claims over a period of time. In order not to go bankrupt. When it comes to insurance and protest, there are a number of factors that determine a payout; yes, a payout. It is a general rule that insurance does not cover eventualities, categorized as an act of God. As opined by many, that the recent protest was an act of God. Because it had not and still does not have a leader. A nameless and faceless protest simultaneously held across the country. In addition to the many prayers held by various devout; Muslims, Christians as well as traditionalist were not left out. If it is God, then insurance would not cover your claim, because it is beyond the direct control of anybody, even the ‘Governors’ confirm this. Property damaged by riot, civil commotion and vandalism are generally covered under comprehensive auto (which is usually a free clause) and householder insurance policies. Depending on the nature of the property, there are several types of insurance policy available to protect vehicles, business or homes from most forms of civil commotion all over the world. A suitable way to assist a potential client is to have tailored made and customized policy to suit their environment. Places prone to violence should have higher premium, as well as  several conditions attached to it.

Furthermore, when insurance renewals are not carried out, as at when due. The insured would not be entitled to a claim. This is one prevailing factor in the market. As it restricts the insurance firms from paying claims. The Insured must not be late to renew is policy, when it is expired, it is obsolete. In addition, a particular differentiation, that needs to be explained; are damages caused by the actual civil unrest and damages caused by burglary and fire that either resulted from an immediate remote cause, or one separate from it? Even though it took place within the time frame of the civil unrest. Some individual houses were burgled. This should not be classified as SRCC (Strike, Riot, and Civil Commotion). The Nigerian market as reported by NAICOM paid a total of three hundred and thirty billion, three hundred and sixty nine million, one hundred and eighty thousand Naira (N330 369 180 000) in 2019. The NAICOM commissioner reiterated this in a retreat earlier this year in Uyo, Akwa Ibom state. With the level of damaged this year, it is expected that claims might go higher, and premium collection might drop due to the effect of Covid 19 on various economies of the world.  Although NAICOM intends that SRCC be charged separately, thereby premium may still be as much as it was last year

My advice to the industry is that insurers should increase the percentage level of excess the insured has. This would aid participation and better understanding of insurance policies to the insured. Hence it would in turn help the penetration of Insurance in Nigeria.

  • Oyediran writes in via Oyediranoyekolade@gmail.com

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