Abstract
Compulsory liability insurance is one of the means by which the State
seeks to protect the citizenry from the risk of death, bodily injury or loss
of property they may be exposed to from certain activities of individuals
and entities. This article examines the laws regulating compulsory
liability insurance in Nigeria and the enforcement of the rights of third
parties within the context of the common law rule of privity of contract.
It is argued that the current tort-based system of compensation coupled
with some regulatory challenges patently constitute a hindrance to a
timely enforcement of the right of third parties under the contract of
insurance. Drawing lessons from some other common law jurisdictions,
including the United Kingdom and South Africa, suggestions towards
enhancing the enforcement of third party rights in Nigeria, including a
case for the institutionalisation of a no-fault system of compensation that
would guarantee quick and effective compensation to affected citizenry,
are made.