By AYOOLA OLAOLUWA
The Motor Vehicle Administration Agencies (MVAA) in the 36 states of the federation, as well as the Federal Capital Territory (FCT), are reeking of a multibillion naira scam involving licensing officers of the agencies.
The Nigerian Insurance Industry Database (NIID) compiled by the Nigerian Insurance Agency (NIA) shows that out of the 12 million registered vehicles on Nigerian roads, only 2.53miliion are having genuine papers, while the remaining 9.5 million go around with fake.
The third-party vehicle insurance is in two categories, private and commercial. While the one for private vehicles goes for N5,000, the one for commercial vehicles comes with a price tag of N7,500
The racket, it was gathered, is being fuelled by the desperate bid by several motorists to beat the FRSC stipulation which made it mandatory for all vehicles to obtain at least a third party insurance certificate to be able to operate on Nigerian roads.
When a vehicle is stopped by any of the numerous agencies that operate in the country, including the police, VIO, LASMA and the FRSC, one of the papers demanded from the driver is the insurance certificate, prompting the rush to get one at all costs.
However, unlike vehicle license and road worthiness certificates which come with security features and could not be easily forged, insurance papers are issued by insurance firms or their agents and printed on ordinary stationeries.
Apart from an ATM like card issued to an applicant and a text message from the NIID confirming the authenticity of the premium, there is no other means of confirming if an insurance policy paper is a fake.
Business Hallmark visited some motor vehicles licensing office in Lagos to investigate how crooked staff of the agencies, supported by touts, daily rip off insurance firms and governments of expected income and taxes by issuing fake motor insurance certificates in return for a token.
The MVAA centres visited are the ones at the Federal Road Safety Commission (FRSC) office at Ojodu; Ijaiye-Ojokoro-Ojokoro LCDA secretariat, as well as the MVAA office besides Access Bank on College Road, Ifako-Ijaiye.
A common occurrence observed by our Correspondent in all the centres visited was the presence of touts, right from the entrance who accosted visitors, demanding to know their mission.
“What do you want sir? Vehicle or drivers license?” a tout asked our Correspondent during a visit to the MVAA office located inside the Ijaiye-Ojokoro secretariat.
Despite refusing their offer for help, they still escorted our Correspondent right inside the motor licensing office. A licensing agent who spoke with BH directed him back to the aggressive looking tout after being informed that he was there to obtain vehicle insurance papers for his car.
“Go and see him (tout). He is the one that will attend to you”, the licensing agent bellowed.
The tout instantly turned courteous, demanding to know the type of insurance policy our Correspondent needed.
“Is it the ‘normal’ or original you want? While the original is N5,000, the normal is only N2,000. However, we don’t do the original here. You have to go to our head office in Ikeja”.
While asked to state the difference between the two, he said they were the same, just that the original will reflect in the NIA database, while the normal will only reflect in the books of the insurance firm.
Observing our Correspondent’s feigned anxiety, he assured: “You don’t need to worry. Are you not a Nigerian? You just want to throw money away. With N2000, I will get you good papers that no officer will ever question”, he assured.
When BH insisted on getting the original insurance, the visibly disappointed tout referred him back to the MVAA agent who then agreed to work on the papers.
“But you will have to wait for like 15 minutes. I will first get your details and fax it to our head office. They are the only one with the authority to issue insurance papers”, he explained.
BH decided to use the opportunity to escape, explaining that he could not afford to wait for another fifteen minutes, while promising to check back on his way from the office after close of work.
It was reliably gathered that most licensing agents prefer to process the fake insurance policies as all the money realised goes into their pockets.
“Most insurance companies, who could not afford the extra cost of having their own offices and personnel, employ licensing officials as their agent right inside MVAA offices.
“They pay them 10% commission on each premium gotten on their behalf. On every N5,000 premium, they get N500 and on the N7500 premium, they get N750.
“You can see why they prefer to issue fake insurance. They can get as much as N1500 on each one while the tout pockets the remaining N500”, disclosed an insider who understands the workings of the racket.
At the MVAA office inside the FRSC office at Ojodu, our Correspondent observed that things were not too different from what he witnessed at the Ijaiye-Ojokoro office.
However, officials from other government agencies working in the complex were found to be culpable and actively involved in the shady business.
When our Correspondent presented himself at the second gate of the complex which leads directly to the VIO office, he was accosted by two VIO officers manning the gate who asked him the purpose of his visit.
Rather than directing him to the appropriate office, BH was directed to a middle-aged woman sitting under a shed with several others touts.
The women quietly informed him that while original insurance will cost him N5,000, the fake one could be procured for N2000.
When told that she should collect N1,000 for the fake insurance, she declined, insisting on collecting N1,500 last.
“Haba, you are talking of the old price. There is no where you will get it for N1,000. My own share of the money is just N300. The guards at the gate who directed you to me will get their cut. We pay returns to some ‘ogas’ who ensure that we operate here.
“The computer operator who will print out the papers will also get their cuts. Even the police know what goes on here. They also get part of the money to remain quite. You can then see that there is not much remaining for me”.
When the reporter asked her if he won’t have any problem with the fake papers, she assured him that no one would disturb him with the papers as long as they are from the Ojodu office.
“You don’t have a problem as long as you are not stopped by officers outside the Ojodu division. But you are on your own if you are arrested by officers outside Ojodu and you could not reach me.
“But as long as you can get me on phone, you are a free man. Nothing do you! We are all ‘we we”, she boasted.
BH findings also revealed that apart from motorists who patronise fake insurance syndicates for their papers, many others who initially obtained genuine papers fail to renew them when their policies expire.
According to the NIA, the insurance industry loses over N192billion yearly to fake motor insurance policies, vowing to tackle the menace of fake motor insurance papers on Nigerian roads by launching a campaign tagged: ‘Wetin U Carry’, where vehicle owners can confirm the authenticity of their insurance papers by dialing *565*11# on their phones.
The Director-General of NIA, Mrs. Yetunde Ilori, said the 2.53 million vehicles registered on the Nigerian Insurance Industry Database (NIID) are those with genuine insurance papers, noting that most motorists are either uninsured or parading fake certificates.
While urging vehicle owners to confirm the genuineness of their insurance coverage with the *565*11# code, she warned motorists with fake vehicle certificates not to expect claims when an accident happens.
Also, the president of the Nigerian Council of Registered Insurance Brokers (NCRIB), Mrs. Bola Onigbogi, lamented that many motorists still patronise fake insurers despite the existence of the compulsory insurance act.