*Number 1*

*Features of insurance contract*


i.) Insurable interest

ii.)  Contract of ‘Uberrimae fidei’ or Contract of Utmost good faith

iii.) Indemni0


iv.) Mitigation of Loss

  1. V) Causa proxima

vi.) Subrogation






A person can enter into a contract of insurance only when he has some insurable interest on the life or property which is insured. Insurable interest basically means that the non-existence or any injury or damage caused to a property or life should bring loss which can be estimated in terms of money.


*Contract of ‘Uberrimae fidei’ or Contract of Utmost good faith*


Both the parties to the contract, that is the insured and the insurer have to disclose all the facts connected with the insurance contract. Non-disclosure of facts or declaration of false information will make the contract null and void.



Life insurance is different from contract of indemnity. It is a contingent contract where the event death is certain to take place but it is a question of time. Hence, the insurance company cannot guarantee against death or prevent death but can agree to pay a stipulated sum in the event of death happening at an earlier date than agreed upon.




Though insurance aims at minimizing the loss, it is expected that every party to the contract of insurance should take adequate steps to minimize the loss. Thus, when a fire accident takes place in a match factory, the insured should minimize the loss by taking adequate preventive measures. He cannot allow the goods to be destroyed by fire simply because he has insured them.




The cause for the accident should be a direct cause for which an insurance is taken and it should not be a remote cause. In other words, the insurance company will pay compensation to the insured only when the cause of accident is directly related to the loss. If the loss is the result of two causes, one must look into the nearest cause and ascertain whether that cause is insured.



Subrogation means stepping into the shoes of another person. When the insurance company pays full compensation to the insured, it takes over the ownership of the goods insured and will enjoy complete right of taking necessary legal steps to claim compensation from such persons who are responsible for the loss suffered.




Risk avoidance is a way for businesses to reduce their level of risk by not engaging in certain high-risk activities. While it’s impossible to eliminate all risks, a risk avoidance strategy can help prevent some losses from happening. It’s an important part of any risk management plan and a way to protect your organization’s assets from potential losses.




2ii) Risk reduction deals with mitigating potential losses through more of a staggered approach. For example, suppose an investor already owns oil stocks. The two factors discussed earlier are still relevant: there is political risk associated with the production of oil, and oil stocks often have a high level of unsystematic risk.


2iv) Risk transfer refers to a risk management technique in which risk is transferred to a third party. In other words, risk transfer involves one party assuming the liabilities of another party. Purchasing insurance is a common example of transferring risk from an individual or entity to an insurance company.


2v) A captive insurance company is a wholly-owned subsidiary insurer that provides risk-mitigation services for its parent company or a group of related companies. A captive insurance company may be formed if the parent company cannot find a suitable outside firm to insure them against particular business risks, if the premiums paid to the captive insurer create tax savings, if the insurance provided is more affordable, or if it offers better coverage for the parent company’s risks.


1.) *Historical experience*


The major reason for the adoption of federal system of government in Nigeria is borne out of the historical experience that brought all the ethical groups together under one Nigeria. It has severally been emphasized by both the Northern and Western politicians that God did not create Nigeria but the British.


The British in their quest for economic wealth and geo-political edges over other Europeans in Africa made Nigeria the largest British colony in Africa. The Emergence of Nigeria as a political entity under colonial rule was not an easy affair. It came about following the necessity for administrative convenience and managerial expenses.



Moreover, it is important to note that most of the ethnic groups in Nigeria had strong political inter-group relationship before colonial rule. The history of Ijaw, Edo, Igala, Yoruba, Igbo, Nupe and Hausa Kingdoms are enriched with social-political relationships that existed before the emergence of the white man. Political institutions, Kinship ties, Origin of towns and their cultural antecedents are enriched with similar history. All these strengthen political bonds and gave Rice to unity in diversity.




2.)  *Unity of the country*


This is also one of the reasons for federal system of government in Nigeria. Federalism was basically introduced to bring about peace and unity in the different regions of the country. In many countries of the world, federalism has emerged as a means of accommodating the growing desire of people to preserve or revive the intimacy of small societies and the growing necessity for larger combinations to mobilize the utilization of common resources.



The unity here is brought about by the desire of the component units of the federation to form union in respect of some matters. Mere desire to unite is not enough but there must be the desire to remain separate in respect to other matters. If the desire to remain separate does not exist, the the association will not be federal but unitary with some delegation of powers to local government.




3.) *Political culture of Nigeria:*



Another important factor that necessitated federalism in Nigeria was the political culture of the country. Evidently, Nigeria’s political culture was federalism friendly and that gave rise to easy adoption of federalism. As I have already explained, Nigeria is an amalgamation of three different regions with beliefs and customs. Federalism was the only solution to ensure peace and unity amongst the leaders and the citizens and that was why federalism was adopted into the Nigerian political system.



In the same way, the political culture of the United States is civic, republican and participatory. It represents a synthetic between two perspectiveneess; one is that politics of the United States should produce the good commonwealth and the other is that the principal task of politics is to create an open political market.





4.) *Ethnic, Religious and Geographical Factor*



No doubt, the Ethnic, Religious and Geographical nature of Nigeria also contributed to the reason why federalism was adopted. This is so because where federal principles apply, the various ethnic groups that cannot or don’t form majority to produce large part may have the opportunity of governing themselves within their federating unit controlled by them.



Common national, racial, religious, cultural linguistic or social ties have often contributed to the unification of political unit. In some areas where major communal or other social antagonism cuts across territorial boundaries, ranging through all the federating units, communities or classes have been driven to seek to protect or strengthen their position by inter-territorial union.


The fear of ethnic groups overlapping regional boundaries and the loyalties of castes cutting of some extent across provincial political boundaries also encourage some groups to support wider federal unions. There is no doubt that geographical factored are one of the influential reasons for federalism in Nigeria.

The effectiveness of linking communications has been a vital factor in geographical unit.





5.). *Minority Marginalization*



Another cogent reason for federalism in Nigeria is the fear of marginalization. In other not to control only some parts of the big country, Nigeria, the colonial masters thought it wise to divide the country into different component units that will be represented in the government. This helped to solve the problem of marginalization in the leadership.


The fear of marginalization by the minority in a unitary system of government has, to a great extent, influenced the majority state support for federating states. In a Unitary system, the minority states cannot govern the entire region which is controlled by majority. Thus, federalism seemed to be the only option left for Nigeria because it allows for popular participation in government. Here, both the majority and minority are represented in the government.




6.) *Resource control:*



The availability of resources in a particular region and the need for that area to control the resources has also been seen as a reason for a federal system in Nigeria. This has nexus with the particular sharing formula adopted. In a unitary constitution which opposes federal principles, everything belongs to the central government; the federating unit does not exist, let alone agitating for resource control. However, that is not so in a federal government system.





– Compromises the Rule of Law:

With the interfered independence of the judiciary also comes the compromise of the rule of law. Many people who would otherwise not have their way within the normal channels will always be too quick to rush to the judiciary to beat the odds. If left unchecked, this might compromise the rule of law permanently.



– Opens the Floodgates for Mob Justice:

This is simply a situation whereby the public law and order is not maintained as per the laid rules and regulations but on what the public wishes for at any given time. This is a bad precedent that should never be set, let alone followed.


– Likely to create confusion:


If the mandates issued out by the judiciary contradict or are in variance with the ones passed by the legislature, the result might be heavy confusion.


– Highly prone to biases:

When all is said and done under this circumstance, the ruling issued out by the judiciary is often largely determined by the strength of the lobbyists, not what is truly good for the public. Thus, it is highly likely to be prone to biases and especially in favor of those with the necessary clout. This is also not to mention the possibilities of corruption and bribery taking root.



– Interferes with the Independence of the Legislature:

Judiciaries ought to be completely independent and uncompromised. That is why, for a large part, they have to base their rulings and convictions purely based on the evidence tabled before them and the laws passed.






*1. Bribery and corruption: some civil servants divert public fund to their personal pockets. Property meant for the public service are turned to theirs.  In fact  some will not perform their routine duties effectively until they are sufficiently bribe. This may lack citizens confidence from the government.*


*2. Poor condition of service: That is,  salaries of the civil servants are not attractive. Promotion are also slow. Citizens will absolutely lost trust in the government.*




*3. Another reason  that will make citizens to lust trust in any government if the political power that is in government failed to fulfilling their manifesto.*


*4. Tribalism, favouritism and nepotism: Some  key appointments into top position and promotion in any government department are not base on merits but nepotism and tribalism preferential treatment to friends, relatives ect.*


*5.  Finally, incompetent of the presidential candidate and his executives. That is, if the three arm’s  of government are not perverting justice according to the constitution. Citizens will lose confidence in the government*


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