In Nigeria, it is compulsory to have motor insurance before using or keeping a motor vehicle on public roads. However, since most Nigerians buy insurance just to get cleared from law enforcement agents on the roads, they choose to go for third party motor insurance which is a lot cheaper than comprehensive policy.

Consequently, because of the preconceived notions that third party policy is just to beat law enforcement agents, many don’t realize that a third party policy is actually legal and indemnifies the insured from third party losses. Unfortunately, a lot of accidented vehicles which ordinarily would have been repaired by the insurance company are borne by the car owners.

Emphasizing this fact is Mr Alex Anaba, Naional Retail Manager(General Business),he said that insurance is a need that you need to have before the need arises. He spoke to AUTOXPAT at the just concluded Nigerian Drivers Conference and Exhibitions stating that third party insurance consists of the insurance comapany as the first party, the policy holder as the second party and others who suffer loss as a result of the second party’s fault becomes the third party. He explained that comprehensive covers both the policy holder and others. Regarding safety, he said “beyond giving out insurance policies, from time to time we engage in periodic education of people on how to be very careful on the roads”

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For a third party motor policy, the first party is you; the second party is the insurance company while the third party is everyone else. So third party motor insurance means that if you damage (crash into) someone else’s vehicle, the insurance pays the owner of that vehicle (the third party), or more importantly if you injure someone else with your vehicle, the insurance pays. Third party liability coverage is part of your basic motor policy and covers you for claims made against you by other drivers after a crash.

In other words, under third party insurance you cannot claim for the car you are driving regardless of whether it is a brand new tear rubber. You need a comprehensive cover for that. If you are driving someone else car, it won’t pay to have the car you are driving repaired. Only the car you hit. If you are responsible for a crash, you might also be responsible for paying to repair another vehicle or covering its driver’s medical costs.

Third party liability coverage protects you against these claims, covering the cost of damage and injuries sustained in a crash in which you were at fault. It is worthy of note that the money to pay for damages comes from the premiums. Invariable, if premium has not been paid for a third party motor insurance, there won’t be any compensation whatsoever, in case of accident. If you go for a third auto party insurance from a registered insurance company, you will be able to save yourself of the cost associated with causing damage to others. Assuming your car injured a pedestrian, the insurance company will pick up the medical bills and thus save you from being torn apart by the relatives of the injured.

However, note that the claim you can make on an auto insurance policy is limited. So, find out the limit to the loss the insurance policy covers before subscribing. For example, an auto insurance policy may only cover loss up to a certain amount say N1,000,000. This means that if the vehicle you damaged is worth more than that, the insurance company will only provide N1,000,000. More importantly, as soon as the insurer thinks you are not acting ‘in good faith’ in other words they think you are trying to rip them off, they will refuse to pay that claim, cancel your insurance, report you to the police for fraud and put you on a blacklist.

To get a third party auto insurance policy contact a registered insurance company or use the services of an insurance broker. Having good insurance If you think you can fight off against an unexpected disaster by yourself then that is great; otherwise, insurance is your best shot.