Fake marine insurance milks N55bn from economy


In the past seven years, the Nigerian economy has lost an estimated N55bn to fake marine insurance. The figure comprises the real premium income to insurance companies put at N30bn and the N25bn loss to unpaid claims.

The estimated loss of insurance revenue is said to have been sold to more than 200,000 policyholders within the period. “In the same period, the number of fake insurers almost doubled,” says Gus Wiggle.

Marine insurance is compulsory insurance for export and import items. It constitutes a potential huge revenue base for the insurance market.  But since its promulgation, insurance companies have not been able to capture 10 per cent of the market due to fake operators.

Delivering a paper, Social And Economic Implication of Fake Insurance Policies, at a one-day seminar in Lagos, Managing Director, Linkage Assurance, Mr Gus Wiggle, bemoaned the scourge of fake insurance, declaring that it constitutes one key loss item in insurance industry.

He spoke to an audience of shippers and maritime regulators last week in Lagos. In his paper, Wiggle looked at the expectations of N12trn premium income for insurance in Vision 2020 and submitted that it requires the combined effort of agencies of govern-ment, law enforcement agencies and players in different sectors of the economy to fight the economic saboteurs.

Employing all kinds of tricks and deception, fake operators sell policies to unsuspecting members of the public and thus deny insurers legitimate income that would have generated tax revenue to government. In addition, they also increase the economic losses arising from unpaid claims.

While blaming the govern-ment for not enforcing the law it made, Wiggle also found inefficient insurance companies\' mode of disposing old and discarded headed papers. He observed that insurance firms fail to destroy old headed papers after change of logo or rebranding.

Wiggle advised members of the public to always buy genuine insurance from licenced underwriters. But should they doubt whether the person selling insurance is genuine or not, they should call Nigerian Insurance Association or National Insurance Commission to verify.

However, he noted that if there are no buyers of fake insurance policies, the fake operators will dry up. There-fore, he accused exporters and importers who want to buy cheap insurance of aiding in the flourishing of fake insurance trade.

However, a representative of Customs promised that its officers will be on the look-out for people who clear goods with fake insurance certificates. According to the Custom official, oftentimes, the insurance certificate is seen as the least of the clearing documents.

Prince Olayiwola Shittu, CEO, Skelas (Nig) Limited, accused genuine insurance companies of complicity in aiding sale of insurance certificates which does not cover anything.  -vanguardngr


Related News