Shippers’ Council Tackles N2.3trn Annual Premiums on Nigeria-Bound Vessels
The Nigerian Shippers’ Council (NSC) has expressed readiness of the council to lobby other government agencies in the maritime industry to tackle the high insurance premium tagged ‘war risk insurance’ slammed on Nigeria-bound ships by foreign insurance companies to insure ships against attacks in the nation’s Niger Delta region and the larger Gulf of Guinea area.
The Executive Secretary of the Council, Hassan Bello disclosed this when he received the Director-General of the Nigerian Maritime Administration and Safety Agency (NIMASA), Dr Dakuku Peterside, who paid a courtesy visit to the Council, recently.
Bello said there is need for collaboration between the NSC and NIMASA to tackle the problem and ensure that such charges are removed from Nigerian-bound vessels.
It was reported recently that foreign and local ship owners as well as charterers entering Nigeria’s territorial and coastal waters were paying a whopping N2.3 trillion every year to foreign insurance companies to insure their ships against any attacks.
Investigations also revealed that each of the 5,000 vessels calling at the nation’s ports are made to pay $100,000 annually (totaling N2.3trillion) as insurance premium, tagged ‘War Risk’.
However, stakeholders in Nigeria’s shipping industry have frowned at the description of the country as a war zone, hence the war risk premium, saying it is a misnomer as the country is not in a war situation.
In insurance parlance, war risk insurance is a type of insurance which covers damage due to acts of war, including invasion, insurrection, rebellion and hijacking.
According to Bello, “Our concern is the surcharges on war risk insurance clause on Nigerian cargo because of piracy. We need to collaborate on that. Because of the issue of security in the Gulf of Guinea and because of apprehension, insurance companies usually levy cargo coming to Nigeria as war zone but it is not really true because you can see that the incidence of piracy and arm robbery has reduced drastically. NIMASA and the Nigerian Shippers’ Council will find ways to tackle that and ensure that such surcharges are removed from our cargo.”
Bello also charged the NIMASA DG to resolve alleged cases of double taxation in environmental levies slammed on the maritime community by the agency and the Nigerian Ports Authority (NPA).
He also called for collaboration and synergy among agencies and stakeholders in the maritime sector to utilize and support the growth of the country’s blue economy.
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