Nigeria Liability Insurance Pool (otherwise called The Pool/NLIP) is an organisation formed in 1988 by a group of reputable and financially strong insurance companies under the umbrella of Nigerian Insurers’ Association (NIA) that control significant proportion of the Nigerian insurance market.
The main objective is to reinsure members’ Liability insurance policies and domesticate their accident reinsurance thereby conserving foreign exchange.
Membership of the Pool is only opened to members of the Nigerian Insurers’ Association, with a minimum of five (5) years operation in Nigeria.
The Pool operation is a form of proportional reinsurance like the Quota Share, Surplus or Facultative Obligatory where Pool members bring their Liability policies to the Pool. While cedant’s interest in the conventional reinsurance is only limited to the premium ceded to and claims recovered from the reinsurers, members’ interest in the Pool goes beyond such restricted pact as they are the owners of and participate in the fortunes of the Pool.
Risks are accepted by members and then ceded to the Pool in a pre-agreed proportion; the Pool in turn arrange retrocession with some reputable reinsurers to protect its exposure.
The Pool Agreement serves as the major document that regulate relationship between members and the Pool management.
Cover note issued by NLIP to its members serves as evidence of contract between members and the Pool and this document is annually forwarded to the National Insurance Commission (NAICOM) by the members alongside their reinsurance plans with reinsurers providing treaty arrangement.