Oil Tankers, Filling Stations Owners Face Imprisonment Over New Insurance Act 2025

• The Nigerian Insurance Industry Reform Act (NIIRA), 2025, mandates that all oil tankers and gas/petroleum refilling stations be insured for third-party damages
• Anyone found in violation of this law faces a fine of at least N1,000,000 or a minimum of two years in prison, or both
• The Act also specifies that certificates of insurance must be displayed at refilling stations or included with documents for petroleum and gas products in transit

Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.

Given the large number of fatalities and property damage caused by oil tanker fires, the Nigerian Insurance Industry Reform Act (NIIRA), 2025, was immediately put into effect.

The Act requires all oil tankers operating on public roads to have insurance coverage for future third-party damages. Additionally, all installations and stations for gas and petroleum replenishing must be insured in the same way.

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According to the NIIRA, anyone found guilty of breaking the law faces a prison sentence of at least two years, a fine of at least N1,000,000, or both. Over 62,000 people have died in more than 6,000 tanker accidents in Nigeria in the last ten years, according to the National Emergency Management Agency (NEMA).

Section 78(1) of the NIIRA states:

"All petroleum and gas refilling stations and installations shall be insured against third-party losses occasioned by accidental fire outbreaks or explosions."

"(2) All vehicles transporting petroleum and gas products shall be insured against third-party losses occasioned by accidental fire outbreaks or explosions."

"(3) The responsibility for the cover referred to in subsections (1) and (2) shall lie with the owner of the petroleum and gas products in transit, or the owner or operator of the relevant refilling station, as the case may be."

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"(4) A copy of the certificate of insurance that meets the minimum requirement shall be displayed in a conspicuous location at the refilling station or included in the documents covering the petroleum and gas products in transit, as the case may be."

"(5) A person who fails to comply with subsections (1), (2), and (3) is liable, on conviction, to a fine of at least N1,000,000, a minimum term of two years imprisonment, or both."

Public building owners face fines

Legit.ng reported that As per the recently approved Nigerian Insurance Industry Reform Act, public building owners and operators risk a fine of N1 million, a 12-month jail sentence, or both if they do not insure their premises against potential hazards.

The PUNCH referenced a copy of the new law, which mandates that all public buildings be insured against potential risks like collapse, fire, earthquake, storm, flood, and other dangers as determined by the National Insurance Commission.

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A tenement house with multiple floors, a hostel, a building occupied by a tenant, lodger, or licensee, and any building to which the general public has access for the purpose of receiving medical or educational services, recreation, or business transactions are all considered public buildings under Section 76(6).

Insurance coverage is necessary to cover the legal liability of landlords and occupiers for bodily injury, death, or damage incurred by third parties and users of the premises, in addition to safeguarding lives and property.

A part of the new law stipulates that, "Also, every direct insurer on policies issued under subsection (1) shall pay 0.25 percent of the net premium received quarterly into a Fire Services Maintenance Fund which shall be established, administered, and disbursed by the Commission to provide grants or equipment to institutions engaged in firefighting services.”

NAICOM raises insurance capital requirements

Legit.ng reported that the capital requirement for insurance companies in Nigeria has been raised by the National Insurance Commission (NAICOM).

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The Nigerian Insurance Industry Reform Act 2025 mandates that life insurance companies have at least N10 billion in capital, while non-life insurers must have a minimum capital base of N15 billion.

The largest boost was given to reinsurance companies, whose capital threshold is now set at N35 billion.

Source: Legit.ng