Builders’ Liability

The Nigerian Insurance Industry Reform Act 2025 (NIIRA 2025) makes insurance on buildings under construction mandatory in Nigeria, superseding the previous Insurance Act 2003. This new law mandates builders' liability insurance for buildings with more than two floors, covering potential risks of collapse, bodily injury, death, or property damage to workers and the public. The requirement applies to buildings of more than two floors and certain public buildings. The policy aimed at providing a safety net for victims of building collapses and other construction-related hazards, as well as to protect property owners and the public. The insurance covers various risks, including collapse, fire, flood, and the legal liability of the builder for injuries or damages to third parties. Failure to comply with the mandatory insurance provision can result in significant penalties, such as fines and imprisonment. The National Insurance Commission (NAICOM) oversees the enforcement of this law.

• Provides protection against liabilities from accidents causing property damage, bodily injury, or loss of life within the building premises.

• Mandatory by law for all public buildings, ensuring compliance with safety and insurance regulations.