Ikoyi Building Collapse: Insurance Commissioner Seek Enforcement of Compulsory Insurance, Tasks Insurers on Awareness

Ebere Nwoji

Following the collapse of 21-story building at Gerard Road, Ikoyi Lagos last week the Commissioner for Insurance, Mr Olorundare Sunday Thomas, has indicated that the federal government will commence the enforcement of compulsory insurance.

He described the building collapse as a national tragedy and stressed the need for governments at all levels, insurance operators to up their games in sensitising the people to key into compulsory insurances like insurance of public building and building under construction.

Section 65 of the Insurance Act 2003 stipulates that all public buildings shall be adequately insured, while Section 64 of the Act provides that all buildings under construction above two floors shall be adequately insured with a registered insurance company.

The law explains further that every public building should be insured against the hazards of collapse, fire, earthquake, storm and flood.

The Act, described Public building to include a tenement house, hostel, a building occupied by a tenant, lodger or licensee and any building to which members of the public have ingress and aggress for the purpose of obtaining educational or medical service, or for the purpose of recreation or transaction.

Thomas, who spoke as a guest a television programme monitored by THISDAY said there are provisions in the insurance Act 2003 for unforeseen unfortunate situations like the collapse building in Ikoyi.

The provisions, he added, are contained in the law on insurance of public building and building under construction.
He decried the fact that Nigerians hardly obey the law adding that the Ikoyi building collapse case falls under the stipulated compulsory insurances.

According to him, “The Law knew that things like this will happen and that things will follow after so the law provided for this by making building under construction one of the compulsory insurances and this falls under it” but what will happen now is to confirm if there is compliance by the owner of the property and if there is insurance then we begin to search for the insurance firm in charge and make them bring succor.”

Meanwhile efforts by THISDAY to unravel the insurance status of the collapse building at Gerard Road Ikoyi and the insurance firms that insured it has so far yielded no result as no insurance firm has owned up to have underwritten the policy.

But the commissioner said insurance is about risk taking and claims payment when the unforeseen happens assuring that if the building was insured, the insurance company in charge would pay and NAICOM as a regulator would ensure that claims were paid.
He said concerning this kind of unforeseen circumstance, the starting point going foreword is for insurance people to create awareness on existence and relevance of such compulsory insurance then the federal and state governments should use their agencies to compel Nigerians to take insurance covers especially compulsory insurances.

He described the incident as one thing that affects many noting that there were a lot of financial implications from it to many people.
“There are a lot of financial implications, children may be out of school, these are liabilities foreseen in the provision, there are also other liabilities, I learnt that people have subscribed to the building and these suppose to rest on the shoulders of insurance people if such building has insurance cover, “he said.
On the question on willingness of insurers to pay promptly, the commissioner said it was one thing to insure and another thing to pay adding that the insurance cover has to be taken first before one could talk about claims payment.

According to him, claims payment is responsibility of insurers adding that if there is delay there is distress mechanism, like the Complaint Bureau of both National Insurance Commission and Nigeria Insurers Association.

He added that tales on non-payment of claims when the unforeseen happens were mere perception by the public especially by those who were ignorance of Insurance.
He said though there were legacy issues in the past, things had changed as he commiserated with families who lost their loved ones in the incident.
On the way forward, Thomas said though no level of claims or provision would bring back dead ones, insurance operators needed to do more on sensitization.
He called on the Lagos State government, whom he said had been bearing a lot of expenses in compensation of victims when that kind of occurrence happened should also stand up to enforce the compulsory insurances to reduce its burdens in this direction.

He described Lagos State as Insurance friendly State adding that it had done much in patronising insurance sector through provision of insurance arrangements for its workforce but said the state government should stand up to help in enforcing compulsory insurance especially the insurance of public buildings and buildings under construction.

He said Nigerians on their part needed to develop reading culture to know their right when issues like the collapse building happened.
He said insurers were doing a lot in terms sensitising the people on the relevance of insurance but that he question was how many people read, “even those that buy insurance at all fail to read their policy documents to understand their claims limit.”

He said the implication was that when the unforeseen happens, they began to make claims not covered by the policy they bought and when the insurer refused to pay on the ground that the claim was outside the scope of the policy coverage, “the news would fly around that insurance firms did not pay claims.”
Meanwhile, the various arms of insurance sector have commiserated with families who lost their loved ones in the incident.
The umbrella body of insurance underwriters the Nigerian Insurers Association (NIA) has described the incident as painful and a big loss to the country.
A statement by the Director-General, NIA, Mrs. Yetunde Ilori, said the association wished to commiserate with the families who lost loved ones in the sad event and wished those hospitalised quick recovery.

While observing the worrisome reoccurrence of building collapse in the country, the NIA, emphasised the need for the general public to comply with all building rules and adopt insurance in the protection of lives and property to curb further incidence of building collapse.
Also the Nigerian Council of Registered Insurance Brokers (NCRIB) has condoled victims of the building collapsed regretting the huge human and financial loss in the disaster.

President of the NCRIB, Rotimi Edu in a statement noted that the increasing cases of building collapse constituted a huge challenge to government and other stakeholders in the built environment calling on relevant authorities to embark on better synergy to ensure compliance with extant building regulations.