New Insurance Reform Act Strengthens Public Safety, Protects Lives and Properties

Landlords and occupiers of public buildings now face a ₦1 million fine, 12 months imprisonment, or both if they fail to insure their properties against hazards, according to the newly enacted Nigerian Insurance Industry Reform Act.

The Act makes it compulsory for all public buildings to be insured against risks such as fire, collapse, earthquake, storm, flood, and other hazards as may be determined by the National Insurance Commission (NAICOM).

Public buildings are defined under the law to include tenement houses above one floor, hostels, rented apartments, and facilities accessible to the public for education, healthcare, recreation, or business.

The legislation also mandates that such insurance policies cover not only the property but also the legal liabilities of landlords and occupiers in cases of bodily injury, death, or property damage suffered by tenants, users, or third parties.

Additionally, every insurer handling these policies is required to remit 0.25% of net premiums quarterly into a Fire Services Maintenance Fund, which will support firefighting institutions with equipment and grants. Insurers that default risk penalties up to 10 times the payable amount and possible deregistration.

Beyond buildings, the Act extends compulsory insurance to Federal Government assets, petroleum and gas refilling stations, and vehicles transporting petroleum and gas products. Operators in violation could face fines of at least ₦1 million or a two-year jail term.

The law also empowers NAICOM to seal unsafe buildings lacking valid insurance and outlines provisions for the use of insurance payouts in rebuilding or repairing damaged properties.