Builders’ Liability Insurance (Compulsory for Construction).

’ Liability Insurance (Compulsory for Construction).

Under the new Insurance Industry Reform Act (NIIRA 2025), builders’ liability insurance is mandatory for any building with more than one floor during construction.

• This applies whether you are a developer, a company, or just a private individual building your own duplex.

• Before local authorities grant approvals or building permits, they are supposed to request evidence of this insurance.

👉 So, if your house is more than one storey high, yes — you must take builders’ liability insurance.

2. Public Building vs. Private Residence

• The law defines “public building” as one that is accessible to the public: schools, hospitals, hotels, hostels, offices, shopping malls, and even residential tenements with multiple occupiers.

• A single-family private residence (that you and your family occupy) is not classified as a public building. Therefore, once construction is completed, you are not legally required to insure it under the compulsory property insurance provision.

👉 So, if it’s just your own family house, you won’t need compulsory occupiers’ liability cover.

3. Why you might still want cover

Even though it may not be legally required once completed:

• Fire & allied perils insurance protects you against loss of the house to fire, flood, or explosion.

• If you are taking a mortgage, banks usually require home insurance anyway.

• If you convert part of your home into rental units or shops, then it may fall into the “public building” category — at which point compulsory insurance would apply.

✅ Summary:

• During construction: Yes, if your house is more than one floor, you must buy builders’ liability insurance.

• After completion: If it’s just your private single-family house, you don’t need compulsory insurance under the Act — though voluntary home insurance is advisable.

• If you rent it out, use it commercially, or it becomes multi-occupancy: compulsory occupiers’ liability/public building insurance kicks in.

Finding a house is quite a mystery to me, honestly

Would you like me to break down how much builders’ liability insurance typically costs in Nigeria for a standard duplex, so you know what to budget?

You said:

What ways would tech enable the insurance industry? What are some tools and platforms that will be helpful for the property value chain

ChatGPT said:

Great question. Technology will be one of the biggest enablers of the new insurance regime in Nigeria, especially in property-related lines. Let me break it down for you:

1. Digital Distribution & Compliance

• Insurtech platforms (e.g., Curacel, MyCover.ai, Casava) are already making it possible to buy insurance in minutes on your phone.

• For the property sector, platforms that link building control authorities (like LASBCA in Lagos) with insurers will ensure no construction permit is issued unless builders’ liability cover is uploaded and verified.

• QR code or blockchain-backed policy verification can allow inspectors and tenants to confirm instantly whether a building is insured.

2. Claims Automation & Trust

• AI-powered claims management systems (e.g., BIMA, Wakam) speed up settlement by auto-verifying documents and photos.

• Drone and satellite imaging can be used to assess property damage after fire, flood, or collapse. This reduces disputes and fraud.

• Smart contracts (on blockchain) could automatically trigger partial claim payments once certain damage criteria are confirmed.

3. Risk Assessment & Pricing Tools

• Geospatial risk mapping: GIS platforms can overlay flood zones, fire risk areas, and building density to help insurers set premiums more accurately.

• IoT & sensors: Smart smoke detectors, water leak sensors, and structural health monitors can be linked to insurance, lowering risk and therefore premiums.

• Credit + property data integration: APIs pulling from land registries, mortgage databases, and credit bureaus help insurers understand property ownership and occupancy patterns.

4. Integration with Finance & Real Estate

• Embedded insurance: Property portals (like PropertyPro or BuyLetLive) and mortgage lenders can integrate compulsory property insurance directly at the point of house purchase, loan approval, or lease signing.

• Digital payments & wallets: Platforms like Paystack, Flutterwave, and USSD banking make it easy for landlords or tenants to pay small insurance premiums in installments.

5. RegTech & Enforcement

• Regulator dashboards: NAICOM can use data feeds from insurers to see which buildings, schools, or hotels are covered.

• E-Government integration: Linking insurance databases with local government property registers will make enforcement (and fines) seamless.

• Data analytics: Helps spot underinsurance and drive compulsory uptake.

6. Tools & Platforms Especially Helpful for the Property Value Chain

• Brokers’ digital platforms (e.g., Leadway, AIICO portals) → help brokers/agents issue certificates instantly.

• PropTech + InsurTech linkages (e.g., Muster, Fibre, Spleet for rentals) → can embed occupiers’ liability insurance into tenancy contracts.

• Building permit platforms (state-level) → integrated with insurance verification APIs.

• Risk-mapping platforms (e.g., Google Earth Engine, local startups) → for insurers and reinsurers to assess exposures.

• Mobile-first apps for SMEs → to onboard small schools, hotels, hostels into compulsory public-building insurance.a