What to Do When Your Insurance Company Won't Pay Your Claim in Nigeria

Insurance is one of the most frustrating financial products in Nigeria. You pay premiums faithfully, something happens, you file a claim — and then begins the delay, the requests for additional documents, the partial offer that barely covers your losses, or the outright denial citing a policy exclusion you never heard of.

Many Nigerians accept this outcome. They assume the insurer has the final word, that the policy is too complex to challenge, or that lawyers make it not worth fighting. None of that is true. You have concrete options — and a clear process for using them.

Types of Insurance Claims Covered by This Guide

• Motor/vehicle insurance — accident repairs, theft, or third-party damage that the insurer is disputing or underpaying
• Health insurance — HMO claims for procedures that were denied as "not covered," or reimbursements that haven't been paid
• Property/fire insurance — claims for fire, flood, or theft damage to a home or business that are being disputed
• Life insurance — beneficiary claim disputes where the insurer is refusing to pay a death benefit
• Travel insurance — cancelled trip or medical claims being denied
• Business/goods-in-transit insurance — loss of cargo or business property being underpaid

Step 1: Get the Denial (or Delay) in Writing

If your claim has been denied verbally or your calls are simply going unanswered, your first move is to demand a written response. Send a formal email or letter to the insurer's claims department asking them to:

• Confirm the status of your claim in writing
• If denied, state the specific policy clause or ground for denial
• If pending, give a firm response date

Having the denial in writing — with the specific reason cited — is essential for the next steps. An insurer who relies on a vague oral denial is much harder to pin down than one who has committed to a specific reason in writing that you can then challenge.

Step 2: Read Your Policy — Specifically

Pull out your policy document and find the exact clause the insurer is using to deny or reduce your claim. Read it carefully. Common tactics insurers use:

• "Not covered under your policy schedule" — verify this by reading your schedule of cover, not just the standard policy wording. Your actual cover may differ from what you're being told.
• "Exclusion clause X applies" — read the exclusion carefully. Many exclusion clauses are narrow and specific; insurers sometimes apply them too broadly.
• "You failed to notify us within the required timeframe" — check whether this is actually stated in your policy, and whether your notification was genuinely late or simply not processed on their side.
• Undervaluation — if the insurer agrees to pay but offers far less than your loss, check whether your policy is "agreed value" (they pay a pre-agreed sum) or "indemnity" (they pay market value), and compare the offered amount to current market value.

If the denial relies on a policy clause you genuinely don't understand, get it reviewed by anyone with legal or insurance knowledge before accepting it.

Step 3: File a Formal Internal Complaint

Every licensed Nigerian insurer is required to have a complaints handling process. Write a formal complaint letter to the insurer's Head of Claims or Customer Experience, stating:

• Your policy number and claim reference
• The date of your incident and the date you filed your claim
• The specific denial or shortfall you are disputing
• Why you believe the denial is incorrect — referencing the policy clause you disagree with, or explaining why their exclusion doesn't apply to your situation
• The amount you are claiming
• A deadline of 21 days for a formal response

Keep this letter factual, specific, and documented. Attach all supporting evidence: the original claim form, photographs, assessor's reports, and any correspondence. Send it by email so you have a delivery record.

Step 4: Escalate to NAICOM

If the insurer fails to respond adequately within 21 days, escalate to the National Insurance Commission (NAICOM) — the industry regulator. NAICOM has a consumer protection mandate and handles disputes between insurers and policyholders.

NAICOM has the authority to direct insurers to pay valid claims, and licensed insurers take regulatory intervention seriously. A NAICOM complaint is not just a consumer complaint — it carries regulatory weight that the insurer's internal processes don't.

Step 5: File for Mediation

If the insurer acknowledges your dispute but the parties are far apart on the amount, or if you want to resolve the matter faster and more privately than NAICOM's timeline allows, mediation is an effective option.

Mediation works well for insurance disputes because:

• The facts are usually documented (policy, claim form, assessor's report, correspondence)
• A mediator can focus the insurer on what the policy actually says versus what they're doing
• A signed mediation agreement is legally enforceable — it binds the insurer just as it binds any other party
• It is faster and cheaper than litigation

Special Situation: Health Insurance (HMO) Claim Denial

HMO claim disputes in Nigeria are particularly common and particularly frustrating. Common denial reasons include "procedure not pre-authorized," "condition is a pre-existing exclusion," or "provider not on our network." Your challenge process:

1. Request the denial in writing from the HMO's medical director or claims department
2. Check your plan document — specifically which procedures require pre-authorization and which are automatic
3. If the denial relies on a "pre-existing condition" exclusion, check your enrollment documents: was this condition declared and accepted at the time you joined?
4. File a formal internal appeal
5. Escalate to NAICOM's health insurance unit or the National Health Insurance Authority (NHIA) depending on your plan type

Special Situation: Underpaid Motor Insurance Claim

Your car was damaged, the insurer agreed to pay, but the amount they offered covers about half of the actual repair cost. This is one of the most common insurance disputes in Nigeria. Key points:

• If your policy is "comprehensive," you are entitled to restoration to pre-accident condition — not a contribution toward it
• Get an independent repair estimate from a mechanic of your choosing. The insurer's assessor's estimate is not the final word — you can challenge it with your own assessment
• If your vehicle was a total loss, the settlement should reflect current market value for the same make, model, year, and condition — not the insurer's internal depreciation schedule