Piracy, Fake drugs, Fake doctors, fake prophets, Wonder banks….. add Fake Insurance and one begins to wonder why do we have so much fake things in Nigeria?
Insurance companies and Practitioners are groaning under the heavy yoke of Insurance Fraud caused by issuance of fake insurance documents. Statistics indicate that Motor Insurance, Travel Health Insurance and Marine Insurance are the worse hit with over 90% of Third Party Insurance certificates being fake whilst the statistics for Marine insurance is even worse – over 95%!!
Investigation by InsuranceAdviceNigeria further revealed that whereas the insurance industry is bleeding, fraudsters are smiling to the bank daily. At major centres where shipping activities are carried out such as Apapa, ASPAMDA Market, Lagos Island market (Isale Eko) etc the Fraudsters operate from business centres issuing fake marine certificates to willing customers at ridiculous prices. For example, you could get an Institute Cargo Clauses ICC “C” marine insurance cover which is the minimum marine cover for N2,500 notwithstanding the Insurance Value. Although the Certificates carry the names and logos of registered insurance companies, the companies know nothing about how they are being issued and premiums are not remitted to them.
Similar situation takes place across most Licensing offices all over Nigeria where touts are having a field day issuing fake motro Third party Insurance certificates for as low as N1,000 whereas the approved price by he regulator is N5,000.
At the Embassies and High commissions in Lagos and Abuja, there are syndicates who specialise in faking Travel Health Insurance certificates to intending travelers. EU Countries mandates travelers to apply for visas with evidence of Travel Health insurance.
The activities of these syndicates constitute a drain on incomes. Imagine the massive loss of revenue to the insurance companies and government! Nigeria has over 10 million vehicles. similarly, the law mandates every importer to obtain a marine insurance for any import into the country.
A top industry executive interviewed by InsuranceAdviceNigeria lamented: “There are so many Nigerians patronizing touts. Visit any Licensing office across the country and you would be amazed at the number of fake certificates being churned out on a daily basis. I sometimes shudder whether it is the lack of faith in insurance companies or lack of capacity by our law enforcement agents or that we just like faking things in Nigeria…… I wish Government could set up a body in the mould of NAFDAC to tackle headlong the menace of fake insurance…”
In a bid to tackle the menace, the Nigeria Insurers Association (NIA) deployed the NIID (Nigerian Insurance industry Database) which made it mandatory for all insured vehicles data to be captured on its database. Although this has yielded some level of success, criminals are still not deterred as law enforcement agents (Police, FRSC, VIO etc) who are partners to the project. are still having sleepless nights.
Recently, the Nigeria Deposit Insurance Corporation (NDIC) released a report which showed that Fraudsters stole N6.2 billion from Nigerian depositors and banks in 2014, with majority of cases related to internet banking and ATM scam. Most of these fraud incidents would also be indemnified by the insurance companies since bank staff usually have their employees insuredagainst the risk of dishonesty/infidelity.