Home owners still shun insurance policy despite high incidence of building collapse

Despite the Insurance Act of 2003, which requires that all buildings be insured against collapse, fire and liability in Lagos, most home owners have continued to shun the policy in spite of frequent building collapse incidents in the country in recent times.

It would be recalled that no fewer than 13 lives were lost and properties worth millions of naira destroyed in the last 14 days alone in two separate building collapse incidents in Lagos.

Experts in the built industry blame the non-enforcement of government regulations for the persistent collapse of structures in the country, while the families of victims of building collapse are left with no compensation and property owners are equally left to bear huge losses due to lack of insurance cover.

Feyi Soyewo, past president, Nigerian Council of Registered Insurance Brokers (NCRIB), in a telephone chat with BusinessDay, agreed that most buildings in the country especially the old ones are not insured.

According to Soyewo, “One major reason for this is that at the time of constructing most old buildings, there was no law that compelled the owners to insure them, as the insurance culture in Nigeria then was not popular”.

“However, despite the new law which has just been put in place, only a few home owners have complied”, he lamented.

“There is a need for us the stakeholders and relevant government agencies to lead the campaign on informing the general public on why they should insure their properties especially the old buildings which are more prone to collapse as we have seen in recent times”, he continued.

He further suggested the need for defaulters to be punished publicly to compel other property owners to insure their structures.

“It is quite appalling that despite the law set up by the Lagos State government in 2010 that buildings over two floors should be insured, the compliance rate has been almost zero”, Kunle Awobode, president, Building Collapse Preventive Guild (BCPG), disclosed to BusinessDay in an interview.

According to him, the compliance rate from the new structures has also been very low. “It all boils down to the effectiveness of these laws because the laws already exist but are not obeyed”, he noted.

“The law was actually set up by the state government to help curb the high incidence of building collapse in the state but it has not lived up to its billing”, he said.

“It is also important we say that some of the factors militating against these buildings not being insured is that most of them were not built to standard, hence it becomes difficult for any insurance company to accept these old buildings under their cover”, he further explained.