Insurance is the legal way of transferring risk from one party to another. It involves an agreement between three parties (including the agent), wherein they transact, and exchange premium for coverage. However, due to the nature of the industry, insurance contracts are legal and binding and can be enforced in case of defaulters. Also, the insurer or insured can enforce as long as there is a legal ground for it. In all, whichever side you fall on, it is important that you know how to enforce and legalize insurance contract in Nigeria. However, you should start by knowing the legal grounds to operate.
What are the grounds to legalize an insurance contract in Nigeria?
For you to enforce and legalize insurance contract in Nigeria, you have to understand the conditions and grounds that surround it. Firstly, a contract may be a written or oral form of agreement between two parties. Furthermore, the statute under section 50 of the Insurance Act governs all insurance contracts in Nigeria. More so, it states that the payment of an insurance premium is a condition for the establishment of an insurance contract. Therefore, if an insurance premium is not paid, an insurance contract cannot exist.
Also, the provision states that “there shall be no cover in respect of an insurance risk unless the premium is paid in advance”. In essence, there are two conditions necessary for the establishment of an insurance contract; a premium must be paid in full and also in advance. Also, part payment is not a valid ground for enforcing an insurance contract. This is because the Act does not include such a clause.
The implication of no or part premium payment is that you would not have a valid insurance contract, neither would you be able to enforce it in a court of law. Furthermore, without meeting those terms, there is no insurance contract or it’s illegal before the law.
How do I enforce and legalize insurance contract in Nigeria?
Only after legalizing an insurance contract, would you be able to enforce it. Enforcing an insurance contract is straightforward and easy, as you only need to approach the court of law. Also, the insurer or insured can do this based on a solid allegation. On approach, the court of law then enforces the implication of the insurance contract. The verdict is based on the evidences presented by both parties. Many times, it’s the party with a stronger and more valid evidence that wins the case.
Before legalizing or enforcing an insurance contract, seek professional help to guide you through the nitty-gritty. This is because having enough evidence without properly understanding the contract could see you lose the case. In essence, at every point in your insurance legalizing and enforcement, seek the help of a legal professional.
You can simply legalize or enforce an insurance contract in Nigeria by paying full premium. Also, after legalizing, you can proceed to enforce the contract clauses if any party defaults in its obligations. In all, note that the court of law only treat valid and legal claims.