By Babatunji Wusu
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Mandatory insurance for all public buildings, government assets, and petroleum facilities
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Defaulters risk fines of at least ₦1m, jail terms up to 12 months, or both
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Insurers to remit 0.25% of net premiums into new Fire Services Maintenance Fund
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NAICOM empowered to seal unsafe buildings
Landlords and occupiers of public buildings in Nigeria now face stricter penalties, including a minimum fine of ₦1 million, a 12-month jail term, or both, for failing to insure their properties against hazards. This follows the signing of the Nigerian Insurance Industry Reform Act, a landmark legislation that expands the scope of compulsory insurance nationwide.
Under the Act, all public buildings must be insured against collapse, fire, earthquakes, storms, floods, and other hazards determined by the National Insurance Commission (NAICOM).
Section 76 (6) defines public buildings as tenement houses with more than one floor, hostels, tenant-occupied buildings, and structures accessible to the public for education, healthcare, recreation, or business transactions.
The law mandates that such insurance policies cover property, lives, and the legal liabilities of landlords or occupiers in cases of injury, death, or damage suffered by users of the premises or third parties.
Fire Services Maintenance Fund
Every insurer issuing compulsory public building insurance must remit 0.25% of net premiums quarterly into a Fire Services Maintenance Fund, to be managed by NAICOM. The fund will provide grants and modern firefighting equipment across the country.
Penalties for Non-Compliance
Defaulters may be fined up to 10 times the required amount, while repeat offenders risk license cancellations. NAICOM is also empowered to seal buildings deemed unsafe for lack of valid insurance coverage.
Wider Insurance Obligations
Beyond public buildings, the Act also makes insurance compulsory for:
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All Federal Government assets and employees (Section 77).
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All petroleum and gas refilling stations, installations, and vehicles transporting such products (Section 78).
Owners of petroleum facilities or transporters of petroleum products must present a Certificate of Insurance—displayed at stations or attached to transport documents. Non-compliance attracts a penalty of ₦1 million minimum, two years’ imprisonment, or both.
The new law is expected to strengthen Nigeria’s insurance penetration, improve risk management, and ensure better protection for lives and property nationwide.
