Insurance Bill 2020 to create Road Safety and Accident Victims Compensation Fund
One of the provisions in the Insurance Bill 2020 which would soon become an Act is the creation of Road Safety and Accident Victims Compensation Fund where insurance operators are expected to set aside three per cent of their net premium on motor vehicles policies for the procurement of equipment for the Nigeria Police, Federal Road Safety Corps and Road-Traffic Agencies.
According to the Bill, a fund to be known as the Road Safety and Accident Victims Compensation Fund would be created and would be managed by a compensation committee which shall consist of – a chairman representing the insurance industry appointed by the Minister on the recommendation of the National Insurance Commission (NAICOM); three persons appointed by the Commission one of whom shall be a medical practitioner with cognate experience in orthopedic or trauma medicine; two representatives of the Commission; a representative of the Federal Road Safety Corps; a representative of the Nigeria Police Force; a person to be appointed by the State Traffic Agencies on rotational basis among the 36 States of the Federation; and a representative of the Federal Ministry of Finance from the directorate cadre.
“The amount due from every insurer pursuant to subsection (1) of this section shall be paid quarterly to the Fund which shall be administered and disbursed, on the recommendation of the Compensation Committee, by the Commission.
“The Commission shall on the recommendation of the Compensation Committee administer and disburse monies accruing to the Fund as follows – 30 per cent to the Federal Road Safety Commission as grant for the procurement of equipment; 20 per cent to the Nigeria Police Force as grant for the procurement of equipment; (c) 10 per cent to road-traffic agencies for the procurement of equipment; 35 per cent into a separate fund out of which the Commission shall pay compensation in accordance with regulations made by the Commission, to any person in respect of death or bodily injury following a motor vehicle accident caused by an uninsured vehicle or an unidentified driver and expenses reasonably incurred by any hospital known to have treated any person involved in any motor accident by an uninsured vehicle or unidentified driver provided such hospital expenses shall not exceed the sum of N250,000.00 for any person treated; and not more than 5 per cent as cost of administration and management of the Fund,” the Bill stated.
It maintained that an insurer who defaults in making payment as required under subsection (1) of this section would be liable to a penalty of a sum equal to five times the amount payable, provided that persistent non-compliance with the requirement of subsection (1) of this section shall be a ground for suspension of authorization to underwrite motor insurance policies by the Commission.
It stated that subjected to the approval of the Minister, on the recommendation of the Commission, the percentage contributions stipulated in subsection (4) of this section may be reviewed every five years after the commencement of this Bill.
“Any person who is found guilty of an offence under this Part for which no specific penalty is provided is liable in respect of a first conviction, to a fine of N50,000.00 or to 6 months imprisonment or to both fine and imprisonment and in the case of a second or subsequent conviction to a fine of N100,00000 or to imprisonment for a maximum term of 12 months or to both fine and imprisonment,” the Bill said.
It maintained that where any claim referred to under this Part and Part XI arises out of an accident involving one or more vehicles, it shall not be necessary, if there is sufficient evidence of proof of loss or damage, for any claimant to report and deliver a police report to the insurer, except death of or serious bodily injury to a person is involved.
“Without prejudice to any other mode of proof,” the Bill said “it is sufficient evidence of proof of loss or damage for the purpose of this section, where – only one person is involved in the accident, the person delivers a statement of the facts to the insurer concerned together with a statement of an eye witness to the accident, if any; or more than one person is involved in the accident, each person delivers a statement of the facts to the insurer or insurers concerned and the alleged facts do not differ in any material particular.”
The Bill maintained that nothing in this section shall be construed as implying that a police report is not required in the case of claims arising from car theft.
