Bisi Bamishe
Third-Party Insurance is a form of agreement or contract between two people or parties. It is a contract whereby one party, who is the insurer agrees, in return for a consideration called the premium to pay the other party, called the insured, a certain sum of money when a uncertain event, loss or damage occurs. However, the insured who is also known as the policy holder, must pay an amount of money which is the premium. Failure to pay premium means breach of contract between the parties. If there is a loss or damage, the insurer will not be able to indemnify the loss.
For many people, car is one of the biggest assets they own. It provides comfort or luxury and the convenience of getting one from point A to B. There are various premium owners of vehicles should pay. As the premium differs, so also the amount of claim the insurer will pay for indemity.
For all motorists plying Nigerian roads, there are two commonly known types of motor insurance covers. They are Third Party Motor Insurance and Comprehensive Insurance covers.
Third Party insurance is one under which the insurer (the second party) agrees to indemnify the insured (the first party or owner of the insured vehicle) if he is liable for injuries done to another person (the third party) who is not a party to the contrac. Such insurance policies cover losses that result from acts or omissions of the insured that are deemed negligent and result in damage to the person, property or interests of other persons.
A third party includes every other person except the contracting party to the insurance contract. He could be a passenger in the insured vehicle or in another vehicle or a person walking along a road in the vicinity of the accident that was injured. When there is an accident to a third party leading to a bodily injury or death insurance company will settle the expenses.
Currently, owners of private cars are expected to N15,000 premium per year to enjoy certain benefits. For example, the insurer will pay up to ₦3 million for damage caused by policy holder to the vehicle belonging to the third party.
This means that the insurance company will pay up to ₦3 million if your vehicle causes damage to another person /third party’s property. Depending on the terms in your policy, you can even get refund of legal fees, if you are prosecuted in court over an accident. Also, lt holds a resale value and may serve as a source of primary or secondary income or in other cases, it may serve the purpose of a collateral depedning on the circumstances.
Commenting on these benefits of third party insurance, a motorist, Mr Oladimeji Adeyi said, “lt is good that there is an increase in the rate of Third party motor insurance policy. For three decades, there has never been a review of the rate we paid. I am a car owner of over 40years.
We all know what is happening in our country today. Inflation has gone up, prices of goods and services have skyrocketed. So, when the new rate were announced in January this year, it was not a surprise. With these rates, insurance companies will be able to pay what is commensurate with premium paid by their clients.”
Still under Third Party insurance, owners of Staff Buses will pay N20,000 premium for N3 million when there is a claim. Special types vehicles are expected to pay N20,000 premium for a N3 million claim. “Special types” are vehicles such as cranes or forklift trucks that aren’t easily spotted on the road but are used for unique commercial purposes. Owned goods vehicles now pays N20,000 premium annually to be able to enjoy a N5 million claim.
However, to enjoy these benefits, motorists must ensure they pay their annual premium. This will also save them from police harassment on the road.
