Nigeria’s Over 113 Millions Workforce: Know Your Mandatory Insurance Right

Boosting awareness of mandatory insurance covers for Nigerian workers estimated at 113, 349,564 in 2024, according to the World Bank’s collection of development indicators is a pressing national imperative, particularly at a time when both individuals and businesses pay a heavy price for ignorance and non-compliance. 

Despite legal mandates requiring insurance protections that span from Employer’s Liability Insurance to Group Life Assurance and Workmen’s Compensation, many workers remain unaware of their rights. 

This widespread lack of information leaves countless employees vulnerable when accidents, injuries, or unforeseen circumstances occur, and it often results from small-scale employers neglecting their obligations out of ignorance or, at times, deliberate non-compliance.

Consider the plight of Adebayo, a 42-year-old factory worker who lost his right hand in an industrial accident after 15 years on the job. Although his employer was legally bound to secure Workmen’s Compensation insurance, Adebayo received no support and now struggles to provide for his family. Similarly, Amina, a 36-year-old nurse, sustained severe injuries when her hospital building partially collapsed during renovations and found herself bearing steep medical bills because the required Occupiers Liability Insurance was not in place. Then there is the case of Joseph, a 28-year-old delivery driver, whose fatal accident left his family unsupported after his employer fraudulently obtained third-party motor insurance. Such stories are far too common, with workers missing out on entitlements worth millions of naira—a gap that not only devastates families but also exacerbates socioeconomic inequalities.

The consequences of non-compliance are significant. Employers who neglect their statutory duties may face penalties as high as ₦1 million for failing to maintain Employer’s Liability Insurance or fines commencing at ₦250,000 for lapses in Group Life Assurance, escalating every day that the default continues. 

Similarly, the mandatory Motor Third-Party Insurance policy—often overlooked or subverted through counterfeit documents—carries harsh penalties such as vehicle impoundment, fines of up to ₦250,000, and even imprisonment for up to a year. 

In the healthcare sector, many professionals operate without the required Professional Indemnity Insurance, risking fines of up to ₦500,000 and the suspension of their licenses. 

The neglect of Occupiers Liability and Builders Liability Insurance further exposes workers, building occupants, and the public to grave dangers, with violations inviting fines of up to ₦500,000 or imprisonment, alongside potential project suspensions and exclusions from lucrative government contracts.

While the Nigerian insurance industry continues to grow, recording ₦1.2 trillion in gross premium income for the third quarter of 2024, a 61% year-on-year increase, with projections pointing to a ₦2.5 trillion close in 2025. The overall insurance penetration remains dismally below 1%. 

Although public awareness has contributed to a 14.4% rise in the insurance sector’s contribution to GDP in 2024, these impressive figures mask the reality that millions of workers remain insufficiently protected. 

The human cost is profound: injuries and disabilities often lead to overwhelming medical bills and lost wages, while grieving families contending with the death of a breadwinner face severe financial insecurity.

Encouraging signs have emerged from a renewed focus on enforcement and public education. Since February 2025, a nationwide collaboration among NAICOM, the Nigeria Police Force, the Federal Road Safety Corps, and various stakeholders has been intensifying efforts to stamp out fake insurance documents and enforce third-party motor insurance compliance. 

With directives from senior officials, such measures are designed to protect both motorists and third parties by imposing vehicle impoundments, significant fines, and even imprisonment on defaulters. 

These enforcement efforts underscore the critical importance of mandatory insurance policies in shielding citizens against the devastating financial consequences of accidents.

In parallel, the judiciary is stepping forward to ensure accountability in other sectors that impact public safety. Chief Justice Kudirat Kekere-Ekun recently urged judges to hold electricity sector operators accountable following an alarming report of 112 electricity-related deaths and 95 injuries recorded in 2024. 

Speaking at a national seminar organized by the Nigerian Electricity Regulatory Commission and the National Judicial Institute, the CJN emphasized the need for strict judicial oversight to enforce safety standards and to ensure that regulatory bodies, such as NERC, operate transparently and in the public interest. 

Her call to action highlights how coordinated governmental and judicial measures can help restore safety and accountability across critical sectors of the economy.

Ultimately, increasing awareness of compulsory insurance policies is essential not only for bolstering regulatory compliance but also for ensuring greater financial security for workers and their families. 

National newspapers, radio broadcasts, television programs, and social media must also play a role in disseminating clear, accessible information about insurance rights and responsibilities. 

Aggressive public enlightenment campaigns, combined with strict regulatory enforcement and unwavering judicial oversight, can help create a more secure and resilient workforce, paving the way for a stable and prosperous Nigerian economy.