Non-enforcement of building law fueling fire incidents

FAILURE of most buildings in major cities in the country to stand the test of time has been attributed to sub-standard works at various stages of construction.

Losses resulting from collapsed buildings either at the stage of construction or occupation bring physical sorrows, tears and pains resulting from outright loss of property and valuables.

This informed the enactment of Section 64 and 65 of 2003 Insurance Act for the compulsory insurance of public buildings and buildings under construction against the hazards of collapsed buildings, damage by fire and other natural disasters like storm, flood, earthquake, as well as arson and other losses related to the incidence of fire.

The Act defines public buildings as including : Tenement house, hostel, building occupied by a tenant, lodger or license, building where the public have ingress and aggress for the purpose of obtaining educational or medical services or recreation or transaction of business. This would include eateries, restaurants, internet cafes, shopping malls, etc.

The Managing Director/CEO , Niger Insurance Plc in a paper he presented at the brokers’ evening in Lagos, x-rayed challenges in the system, adding that this provisions should provide a lot of benefits to Nigerians taking into cognizance the incessant collapse of buildings nationwide especially in major cities in the country. This is often accompanied by fatal consequences together with human and material losses. Likewise, incidences of fire, flooding recorded in Lagos, Ibadan and some other parts of the country.

Insurance of public buildings, he explained, is meant to provide and avenue for compensation to third parties and users of damaged properties. As with all compulsory insurances, it provides a socio-economic function in the society. However, despite all efforts by the National Insurance Commission (NAICOM), not much has been achieved in the implementation or enforcement of this provisions. This confirms the opinion of experts on compulsory insurance that it should be restricted to areas where the need is generally felt and in sectors where supervision is possible at a reasonable cost.

Nevertheless, he said, it is important to stress that problems associated with the insurance of public buildings cannot be divorced from the general problems of the Nigerian insurance industry, though some peculiar challenges are identified.

According to him, NAICOM, in its corporate strategic plan 2011-2015, had listed the hindrances as threats to the industry. Therefore, the challenges which I would like to address at this forum are basically the following: Ineffective legal framework, poor compliance culture, lack of awareness on the part of the public, and finally, ineffective implementation of strategy adopted by NAICOM.

Generally, he said, the legislative framework for insurance practice in Nigeria is inadequate and ineffective, Often times we find the law making unenforceable provisions which though good on paper is almost impracticable without strong enforcement provisions. The law makes provisions for NAICOM to enforce the insurance laws against insurance companies through the inspectorate division in the commission, but provides no means of enforcement against the public in general. The commission has no power of arrest irrespective of the fact that there are sanctions provided in law. How would you arrest and legal action be taken to ensure sanctions are meted out to individuals in breach of the law?

“It is pertinent to note that before the insurance Act of 2003, there were compulsory insurances in place such as the third party motor insurance and the workmen compensation policy (now abolished). They had separate enactment for them such as the Motor Vehicle (Third Party Insurance) Act 1945 and the Workmen’s Compensation Act of 1990”.

According to him, in the case of the compulsory third party, Section 17 Motor Vehicle (Third Party Insurance) Act, Police officers are empowered to enforce the compulsory insurance provisions of the Act. This position was reinforced in the Insurance Act of 2003. Therefore, the Police Force and the Ministry of Labour ensured compliance with these provisions respectively.

Unlike, the above two, he said, there is no separate enactment for compulsory insurance of public buildings. This inadequate legal framework makes it completely difficult to enforce the provisions considering the fact that NAICOPM or any regulatory body at their inception has never enforce legal provisions on compulsory insurance against the public.

A chieftain of the industry who pleaded anonymity said that apart from the enormous direct losses, which was inseparable from the consequential interference as loss of profit , wages, as well as unemployment, it also generated social problems and frustration.

He said the insurance industry in Nigeria are very strong to meet all obligations to clients. If you look at the yearly reports of claims payments published by the Nigerian Insurers Association (NIA), so that the question of the industry not paying claims does not arise as no reputable insurance company will deliberately refuse to pay genuine claims.

According to him, insurance is the bedrock that provides the needed support that can effectively absorb shocks within the polity. Therefore, insurance is an effective means to mitigate effects of disasters, we should do everything possible to bring this about.