• By Dr. Decent Oghenetega Akar
• Legal & Regulatory Advice

8 Key Insurance Rules in Nigeria’s New Act Every Property Owner, Developer & Investor Should Know

The Nigeria Insurance Industry Reform Act, 2024 is not just a law for insurance companies — it’s a direct shake-up for the real estate sector.

From compulsory builder’s insurance to allowing insurers to fund property developments, the new law makes insurance a core part of property planning, construction, ownership, and management.

At Tech City Real Estate Ltd, we believe this law will redefine how landlords, developers, facility managers, and investors operate — making compliance, safety, and risk management central to success in the property market.

Here’s a breakdown of 8 important provisions you should know.

1. Mandatory Builders’ Liability Insurance

Sections: 75(1)–(3), (7)
Before any construction begins, owners and contractors must secure builders’ liability insurance to cover injuries, deaths, or third-party property damage during building works — including collapse. Building control authorities will require proof before giving approvals.
Why it matters: Insurance becomes a must-have in project budgets, preventing unexpected disasters from stalling developments.
Key takeaway: No policy, no permit — developers must insure before building.

2. Public Buildings Must Be Insured

Sections: 76(1)–(4)
Owners and occupiers of public-use properties — such as malls, offices, hostels, shops, and tenements — must insure them against risks like collapse, fire, earthquakes, storms, and floods.
Why it matters: It brings more commercial and multi-tenant properties under safety and protection coverage.
Key takeaway: If people use your building, the law says it must be insured.

3. Strict Enforcement with Seal-Off Powers & Penalties

Sections: 76(5)–(7)
Regulators can now seal non-compliant buildings. Offenders risk a minimum of three years in prison or fines starting from ₦2 million.
Why it matters: Non-compliance is no longer a slap on the wrist — it’s a serious legal and financial risk.
Key takeaway: Ignoring insurance requirements can cost you millions — or your freedom.

4. Fire Claim Payouts Must Be Used for Rebuilding

Sections: 79(1)–(3)
Insurance settlements for fire damage must be channelled directly into rebuilding or restoring the affected property. Insurers can manage payouts to ensure reconstruction happens.
Why it matters: Protects long-term property value and ensures business continuity after damage.
Key takeaway: Fire insurance funds must go into restoration, not personal spending.

5. Government Assets Must Be Covered

Sections: 77(1)–(3)
The law mandates that all government-owned buildings and infrastructure be insured.
Why it matters: Increases institutional demand for property insurance and safeguards public resources.
Key takeaway: Government will now practise what it preaches — insuring its own assets.

6. Insurers Can Now Invest in Real Estate Projects

Sections: 27(2)(g), 27(5)
NAICOM can approve investments from insurance companies into property developments and infrastructure. If another law conflicts, this Act takes priority.
Why it matters: Creates new streams of institutional funding for developers and investors.
Key takeaway: Insurance companies can now invest directly in real estate developments.

7. The Act Overrides Other Housing Laws in Conflicts

Sections: 230(1)–(2)
When insurance requirements in this Act clash with housing-related laws like the National Housing Fund Act, the Insurance Act will take precedence.
Why it matters: Eliminates legal confusion for developers, lenders, and property managers.
Key takeaway: On insurance matters, this Act is the final word.

8. Compulsory Coverage for Petroleum & Gas Facilities

Sections: 78(1)–(2)
Petrol stations, gas plants, and other energy facilities — even those on leased land — must carry insurance.
Why it matters: Reduces high-risk exposure for landlords and neighbouring properties.
Key takeaway: High-risk facilities must be insured, no exceptions.

What This Means for the Real Estate Industry

This reform hardwires insurance into Nigeria’s property market — from approvals to occupancy.

For property owners, investors, and developers, it means:

• Insurance compliance will be a condition for permits and operations
• Property values and investor confidence will be better protected
• New funding opportunities as insurers become real estate investors
• Non-compliance will carry heavy legal and financial consequences

At Tech City Real Estate Ltd, we help our clients stay ahead of these regulatory changes while securing safe, profitable, and compliant property investments.

📞 Need expert guidance on property compliance and profitable investments? Contact us today — let’s secure your future in real estate.