Introduction

In Nigeria, many drivers believe car insurance is either unnecessary or only meant to satisfy legal requirements like vehicle registration. Unfortunately, this mindset leads to underinsurance, financial loss, and frustrating claims experiences.

Worse still, a lot of misinformation about car insurance continues to spread—from street corners to social media platforms. These myths prevent car owners from making informed decisions that could protect them from hefty losses due to accidents, theft, or third-party damage.

In this blog post, we’ll debunk the top five myths about car insurance in Nigeria and explain what the facts really are, so you can drive smart and insured.

Myth 1: “Third-Party Insurance Is Useless—It Doesn’t Cover My Own Car”

✅ The Truth: Third-party insurance is essential and legally required

Many Nigerians believe third-party insurance is a waste of money because it doesn’t cover damage to their own car. While it’s true that third-party motor insurance only covers damages to other people’s vehicles or property, that doesn’t make it useless.

Here’s why third-party insurance matters:

• It’s compulsory under Nigerian law. Driving without it can lead to fines, your vehicle being impounded, or worse.

• It protects you from huge financial liabilities if you cause an accident that results in injuries, deaths, or property damage to others.

• You won’t have to pay compensation out-of-pocket if you’re found liable.

Tip: If you want your own car covered too, go for comprehensive insurance, which includes third-party protection plus cover for your own vehicle.

Myth 2: “All Car Insurance Companies Are Scammers – They Never Pay Claims”

✅ The Truth: Not all insurers are the same—choose wisely

This myth is rooted in real frustration. Some Nigerians have encountered shady insurance agents or companies that made excuses not to pay claims. But this doesn’t mean the entire industry is fraudulent.

There are reputable, NAICOM-licensed car insurance providers in Nigeria with strong claim settlement records.

How to avoid scams:

• Verify the company’s registration with the National Insurance Commission (NAICOM).

• Read reviews online and on social media.

• Avoid “cheap roadside agents” offering insurance for as low as ₦5,000 without paperwork.

• Ask for your Certificate of Insurance and verify it online via the Nigerian Insurance Industry Database (NIID).

Reputable insurers like AXA Mansard, AIICO, Leadway, Custodian & Allied, and Mutual Benefits have transparent claims processes.

Myth 3: “Comprehensive Insurance Is Too Expensive for the Average Nigerian”

✅ The Truth: It’s more affordable than you think—and it saves money in the long run

Many Nigerian drivers shy away from comprehensive insurance because they assume it’s unaffordable. In reality, comprehensive cover costs between 3–5% of your car’s value annually.

For example, if your car is valued at ₦3 million, a comprehensive plan may cost between ₦90,000–₦150,000 per year (or ₦7,500–₦12,500 per month).

What does comprehensive insurance cover?

• Theft or carjacking

• Accidents (even if you’re at fault)

• Fire damage

• Vandalism

• Third-party liabilities

• Natural disasters (floods, storms, etc.)

Instead of paying ₦1.5 million to replace your car after an accident or theft, you could have protected it with a fraction of the cost.

Tip: Some insurers now offer monthly payment plans or usage-based insurance to make coverage more accessible.

Myth 4: “Once I Have Car Insurance, I Don’t Need to Worry About Anything”

✅ The Truth: Insurance is a contract—with conditions and responsibilities

Too many Nigerian drivers assume that once they buy car insurance, they are covered for anything and everything. But insurance doesn’t cover negligence, dishonesty, or failure to follow the terms of the policy.

What most policies don’t cover:

• Driving under the influence of alcohol or drugs

• Unlicensed drivers using your car

• Using your car for commercial purposes (e.g., Uber, Bolt) without disclosing to the insurer

• Mechanical failures or wear-and-tear

Also, your claim can be denied if:

• You don’t report the accident promptly (usually within 24–48 hours)

• You fail to provide proper documentation (e.g., police report, repair estimates)

• You give false information on your application

Always read your policy document carefully, and when in doubt, ask your insurer to clarify.

Myth 5: “You Can Only Buy Insurance Through an Agent or Roadside Office”

✅ The Truth: Car insurance is now fully digital and accessible online

The days of queueing up at insurance offices or dealing with dubious agents are over. Many top insurers in Nigeria now offer fully digital platforms where you can:

• Get quotes

• Compare plans

• Purchase policies

• Download your Certificate of Insurance

• Renew policies

• Track claims

Some top platforms:

• AXA Mansard’s website

• Leadway Assurance

• AIICO Insurance

• Aggregators like CompareIN and MyCoverGenius

This makes it easier, faster, and safer to get insured—without middlemen and hidden charges.

Bonus Myth: “Only New or Expensive Cars Need Insurance”

✅ The Truth: Every car on Nigerian roads is at risk—new or old

Car theft, reckless driving, poorly maintained roads, and unpredictable weather all contribute to the risks of owning a car in Nigeria. Even your old car can be written off in a split second due to an accident or fire.

So whether your vehicle is worth ₦500,000 or ₦5 million, insurance is a smart investment. At the very least, have valid third-party coverage to protect against legal and financial liabilities.

How to Spot Real vs Fake Car Insurance

When in doubt, call the National Insurance Commission (NAICOM) or check the insurer’s credentials online.

Final Thoughts

Car insurance in Nigeria is not just about satisfying a government requirement—it’s about protecting your car, your finances, and your future. Don’t let myths prevent you from getting the right coverage.

Here’s a quick recap of what we’ve debunked:

1. Third-party insurance is vital and legally required.

2. Not all insurers are scammers—reputable providers do exist.

3. Comprehensive coverage is affordable and valuable.

4. Insurance comes with responsibilities—read your policy.

5. You can now buy insurance online, hassle-free.

Conclusion: Drive Smart, Stay Protected

With increasing traffic accidents, car theft, and environmental risks in Nigeria, driving without insurance is a gamble no one should take. Educate yourself, separate fact from fiction, and choose the insurance plan that truly protects you.

Have you believed any of these myths before? Drop a comment below—we’d love to hear your thoughts.

Or share this article with someone who needs the truth about car insurance in Nigeria.