How to read a Nigerian insurance policy (before you sign).

The short answer

Insist on the full policy document — not the brochure, not the WhatsApp summary, the actual policy wording — and read the Exclusions section first. Then the Excess section. Then the Definitions. If those three pass your sniff test, only then look at the cover amount. Verify the insurer is NAICOM-licensed and check their published claim-settlement ratio.

The 8-step checklist

1. Insurer NAICOM-licensed? NAICOM (the National Insurance Commission) maintains the public register of licensed Nigerian insurers — life, non-life, composite, re-insurance, microinsurance, takaful. If the company isn't on the register, the policy is worthless. Verify before anything else.
2. What's their claim-settlement ratio? The single most important number in Nigerian insurance — what percentage of claims they actually paid, by count and by value. NAICOM publishes this quarterly. Below 60% by count is a red flag. See the latest leaderboard.
3. Read the Exclusions first. Every policy has a list of things it does NOT cover. Read this list before the inclusions, because this is where most claims die. "Pre-existing conditions" in a health plan, "wear and tear" in a car policy, "civil unrest" in a property policy — each one cuts a whole category of likely claims out of the contract.
4. Know your Excess (deductible). The excess is the amount you pay yourself before the insurer pays a kobo. A ₦5M car policy with a ₦200,000 excess means a ₦150,000 repair gets you nothing. A ₦2M health plan with a ₦50,000 excess per incident means malaria treatment is on you. The excess is the silent rate-up — a smaller-than-it-looks policy that you bought thinking it was big.
5. Check the Sub-limits. A "₦5M cover" plan often has internal caps: maybe maternity is sub-limited to ₦400,000, dental to ₦80,000, eye care to ₦50,000. Add up the sub-limits that apply to you and check whether they cover what you actually need. The headline ₦5M is often unreachable except through one big trauma claim.
6. Definitions section: read every word. "Hospital" is defined. "Hospitalisation" is defined. "Total loss" is defined. "Pre-existing condition" is defined. These definitions decide every borderline claim. A common trap: a policy may define "hospital" to exclude facilities under a certain bed count, which quietly cuts most clinics out of cover.
7. Claim-notification window? Most policies require you to notify the insurer within 24-72 hours of an incident. Miss the window — even if the rest of your claim is bulletproof — and they will reject on procedure. Know the exact number. Save the claim hotline in your phone the day you sign.
8. Cancellation and refund terms? If you cancel in year 1, what do you get back? Many Nigerian policies have steep "short-period" cancellation tables that return as little as 20-30% of the premium even if you cancel in month 11. If you might need to switch, know what you lose.

The seven phrases that should make you put the pen down

• "Subject to underwriter's discretion" — translation: we'll decide at claim time.
• "Reasonable and customary charges" — they get to decide what's "reasonable", not you.
• "Approved network of providers only" — find out exactly which hospitals/clinics, today, in writing.
• "Waiting period of [n] months" — common, but know whether it's 30 days or 24 months for your specific concern.
• "Pre-authorisation required" — usually fair, but find out the process and the response time.
• "Acts of God excluded" — frequently broad enough to exclude floods, which is the most common cause of property damage in southern Nigeria.
• "Material misrepresentation voids the policy" — fair, but the agent should help you disclose properly, not minimise.

The most-common policyholder mistake

Trusting the agent's verbal summary instead of reading the policy document. The agent is paid on commission to close you. The policy is what governs your claim. They are often different documents in spirit if not in fact. Always ask for the printed policy wording before you pay; if the broker won't release it pre-payment, that's the broker telling you the document won't survive scrutiny.

If your claim is wrongly rejected

File a complaint with NAICOM via the Complaints Bureau. NAICOM does intervene and frequently compels insurers to pay valid claims; the regulator publishes the worst offenders. Keep every document — medical reports, police report (if any), original receipts, photographs, the rejection letter — for the complaint file. The Nigerian Insurers Association also runs an industry-level complaint channel.

Bottom line

Insurance is a contract, not a relationship. The piece of paper decides. Read the exclusions and the excess before the cover amount; verify the insurer's claim-settlement ratio before the brand; insist on the wording before you pay. A two-hour read can save you a year of arbitration.