MOTOR INSURANCE RATING IN NIGERIA (PROBLEMS AND PROSPECTS)
- Format: Ms Word Document| Pages: 85 | Price: N 3,000| Chapters: 1-5
- Get Complete Project Material(s) Now! »
This project is a comprehensive frame work in the topic, Motor Insurance Rating in Nigeria, (Problems and Prospects) it entails the meaning, rating motor insurance in Nigeria motor insurance rating is aimed at stipulating what covers certain motor insurance coverage aught to attract. It is equally examines how motor policy will be indemnified if he suffers loss, damage, injuries as the case may be. This work is aimed at studying how motor insurance rating can affect the insuring public as well as the generability of the public. To achieve this aim, the researcher reviewed related literatures written by reputable professionals, approved authorities, institutions and organization from the research question and analysis the researcher discovered that motor insurance rating is yet to be made uniform in the country. Remedies were recommended on how this issue can be addressed to be in the interest of the insuring public as well as the country at large. Conclusions were finally made on the findings.
TABLE OF CONTENTS
- BACKGROUND OF THE STUDY 1
- STATEMENT OF THE PROBLEMS 3
- OBJECTIVE OF THE STUDY 5
- SCOPE AND LIMITATION OF THE STUDY 6
2.1 LITERATURE REVIEW 8
2.2 TYPES OF COVER AVAILABLE 10
THE EXTRACTS, UNDERWRITING
OF MOTOR INSURANCE 15
2.3 MOTOR TARIFF IN NIGERIA 26
2.4 MOTOR INSURANCE CLAIMS PROCEDURE 28
2.5 DEFINITION OF TERMS 38
3.1 RESEARCH DESIGN AND METHODOLOGY 42
3.2 SOURCE OF DATA 42
3.3 LOCATION OF DATA 43
3.4 METHOD OF INVESTIGATION 44
RESEARCH FINDINGS 45
5.1 RECOMMENDATION 48
5.2 CONCLUSION 49
1.1 BACKGROUND OF THE STUDY
In retrospect, motorist was at liberty to drive his car on the highway without any form of insurance protection. But as the number of motor vehicle playing the road increases. So did the accident rate and the subsequent death and injuries.
In many cases, the victims of these motor accidents even when the court might as the motorist to pay a certain sum as compensation, they were unable to receive such award because the motorists were without adequate funds. The lead to public out cry and a solution has to be found. The only sensible solution was to make it compulsory for every motorists to be insured so as to ensure that the victims of motor accident obtained adequate compensation in appropriate cases.
An European trading company that established post in Nigeria and appointed their companies as agents for insurance business introduced motor insurance rating in Nigeria. During that time Nigeria traders were given power to secure insurance business, issue cover notes mostly for cargos and also giving helping hand in claim settlements.
Royal Exchange Assurance branch office was established in Nigeria in the year 1923. This company dominated insurance for almost 30 yeas before the establishment of other companies such as provincial insurance company limited now West Africa provincial insurance company, Norwich union fire insurance company and Nigeria General Insurance company limited just to mention a few. When the British parliament passed the read traffic act in the year 1930 and subsequently part (6) of the act was incorporated in Nigeria as the Traffic Act (1960) and this gave birth for the first time to legal backing on motor insurance practice in Nigeria.
1.2 STATEMENT OF THE PROBLEM
Like in any other business ventures, various problems are associated with motor insurance rating. It is therefore necessary to enlighten those problems here in order to find solution to them. As stated in the introduction that the concept of modern insurance as an idea was brought into Nigeria by the British, brings no doubts that the initial problems was on the practice law of insurance. The problems is that Nigeria insurance are only operating with another country’s law in theory and not in practice. This could be seen in their act of clearing some premium rate from prospective insured in the rural areas of the nation who are less susceptible to theft and accident damage. (eg. collision death) with those in urban cities where death is rampant with frequent motor accidents.
Inflation, the problem affecting all the financial sectors of the economy with the prevailing inflation and exchange rate the traffic device with aids motor insurance underwriting which was reviewed in 1991 and this has caused premium to increase and thereby making it necessary for the insured to reduce caver from comprehensive to third part. The problem of bad road settlement of claim, most of Nigeria insurance company has been dented as a result of controversies amounting, from this aspect of insurance claim.
Finally the public are based toward insurance company they perceived than a legalized armed robbers or four one nine (419). Most of the insuring public effect motor insurance policy in order to comply with the law requirement (company insurance) rules and regulations to avoid police embarrassment. It must be emphasized here that majority of the insuring public are illustrated, they do not understand what is written in the insurance policy that is sold to them.
1.3 OBJECTIVE OF THE STUDY
In this objective of the motor insurance rating in Nigeria (problems and prospect) is in two folds. The first reason is mainly on the components of the topic itself, we have the followings:
- Origin of motor insurance in Nigeria
- The extracts, underwriting and rating recommendations of the tariff/business.
- The motor tariff system in Nigeria
- The various claim procedure.
The second reason is the need to carryout a study in partial fulfillment of the requirement for the award of National Diploma in insurance and more so to create a good insight into motor insurance practice in Nigeria in order to contribute towards the national growth of the country. The researchers hope that this project would also enlighten the insuring public on how their risk is rated before being accepted by insurance.
1.4 SCOPE AND LIMITATIONS OF THE STUDY
Insurance is said to be a risk transfer mechanism. The insurer accepts the risk and receive premium in consideration for the risk accepted. Insurance therefore provides a solution to our risk.
On this topic of motor insurance rating in Nigeria, the writers believe that they will provide the needed information on the importance of motor insurance and its growth in the country’ economy. It is known that motor insurance covers a wide spectrum of insurance underwriting is Nigeria. A lot of people want to use cars while there is no compulsory motor insurance legislation. It is apparently necessary to know the method of rating which insurers adopt for their client and the classification of coves and principles of rating in the insurance business especially in motor insurance business.
This research work on motor insurance rating in Nigeria will be limited to Lagos areas for various reasons:
- The population of motor vehicle used in the state of greater than anywhere else in the country.
- Lagos is a state where motor insurance have heir head office.
- It is one or the commercial centers in the country.
- And the most relevant statistical data available in the state hence the researchers will have enough data for the successful completion of the project.