No insurance coverage duvet for airports, exposes FG to losses, compensation claims

•Provision for insurance coverage eliminated in fresh NCAA regulation —  Consultants

By Rosemary Iwunze

Indications occupy emerged that the Federal Government can even fair shoulder the stout monetary burden springing up from primarily the most as a lot as the moment fire incident on the worldwide terminal of the Murtala Muhammed Global Airport, following the shocking absence of insurance coverage duvet for Nigerian airports.

The airport is managed by the Federal Airports Authority of Nigeria, FAAN.

Findings by Financial Main edge printed that a couple of months after the incident no insurance coverage company has reported claims publicity or liability in relation to the airport fire effort, elevating considerations over the lack of insurance coverage protection for crucial aviation infrastructure in the country.

The draw implies that authorities will no longer simplest finance the rehabilitation of the burnt terminal estimated at over a thousand million Naira, nonetheless will moreover be accountable for compensating affected victims and settling all scientific charges attributable to the incident.

The wretchedness comes despite an earlier approval by the Federal Govt Council of N712.26 billion for the comprehensive rehabilitation of Terminal One of the airport before the fire outbreak.

Commissioner for Insurance, Mr. Olusegun Omosehin stated that no insurance coverage company has paid claims in respect of the airport fire incident.

He stated: “I’m no longer aware of the entities that lined the airport. If there used to be duvet on that property, claims must be paid. That is where we stand.”

Alternate consultants licensed that while aviation regulations bring together it compulsory for all aircraft operating in the country to raise insurance coverage duvet, there’s never always a regulatory requirement compelling airport operators to insure airport terminals and connected infrastructure.

The draw has again brought to the fore considerations over risk administration practices in the aviation sector, especially on the self-discipline of protection of strategic nationwide resources in opposition to fire and different operational hazards.

Financial performance

At the backdrop of non-coverage of the airport infrastructure, Financial Main edge findings indicate precise increase in the blended aviation and marine insurance coverage premiums.

However industry operators stated many of the premium comes from the marine segment, while aviation premium is mostly from aircraft covers.

The strongest increase in the previous 5 years came in 2024. While the insurance coverage industry total premium expanded by 50 aviation and marine insurance coverage premium surged by 73.9 per cent to N128.2 billion from N73.7 billion. Claims profile rose significantly at some stage in the year as aviation and marine claims rose by 106 per cent to N64.2 billion from N31.1 billion.

In 2025, the industry sustained its expansion trajectory as total premium revenue elevated by 47.5 per cent while aviation and marine insurance coverage premium rose by forty five.9 per cent to N187.1 billion from N128.2 billion.

Operators’ perception

Speaking on the aviation segment insurance coverage both aviation and insurance coverage consultants lament that the airports are no longer insured.

An aviation analyst, Grp. Capt. John Ojikutu, retd, stated that the absence of comprehensive insurance coverage coverage for these airports may possibly possibly uncover authorities to broad monetary losses and compensation claims in the match of predominant mess ups.

Ojikutu stated: “Statutory regulatory requirements may possibly possibly occupy to mandate airports to occupy a comprehensive insurance coverage duvet nonetheless that’s no longer the case in the country on the present time.

“Earlier provisions of the Nigerian Civil Aviation Rules required global airports to raise insurance coverage coverage of about $250 million, while domestic airports had been expected to raise coverage of round $100 million. “The regulations that came out in 2012, which had been reviewed in 2022, made provision for our global airports to be insured for $250 million.

“However, in the fresh regulation, the insurance coverage is no longer there. Whose fault? I will seemingly be pleased the Nigerian Civil Aviation Authority, NCAA, accountable.

“The impact of an uninsured airport may possibly possibly be broad financially, especially for authorities. Government would deserve to commence allocating gargantuan sums of cash to rebuild such infrastructure. Of us that create industry on the flexibility may possibly possibly moreover be compelled out of industry.”

Furthermore talking, former Total Manager, Public Affairs for defunct Nigeria Airways, Mr. Chris Aligbe, who is now Chief Govt Officer of Belujane Konzult, stated that it’s crucial that airports are insured.

He stated: “This can even very correctly be very crucial that we insure our airports because in different nations, the volume of cash that’s being extinct to assemble or renovate airports is regularly no longer spent by governments for the time being.

“A couple of nations, who occupy cash to use, just like the Center East nations create. In Africa, there’s Angola. Angola is an oil producing country, nonetheless I assume it’s no longer even doing so itself.

“Some different West African nations occupy finished theirs themselves, nonetheless these are nations with correct one airport. Their population is no longer very gargantuan, nonetheless the fact is that while fresh developments occupy confirmed that concession is one of the most true methods to finance airport pattern, these airports must be insured.”

Furthermore talking, Mr. Sunny Adeda, former President of the Chartered Insurance Institute of Nigeria, CIIN, stated that aviation as an industry is global in nature and therefore aviation insurance coverage is affected in the worldwide market extra than any different department of insurance coverage.

He stated: “The Nigeria aviation sector ensures that every aircraft operating in the Nigeria airspace is insured, nonetheless such can’t be stated of the airports.

“Aircrafts are excessive valued and therefore price at risk in all equity excessive. You wish an insurer with loads of monetary energy to play on this class of industry.

“Even domestically, strict regulations by the insurance coverage regulator are in space for any operator that wishes to take part in aviation industry.

“Essentially the most as a lot as the moment local legislation in Nigeria is the Nigerian Civil Aviation Authority (NCAA). A carrier must submit his insurance coverage certificates to the NCAA before they’ll characteristic a domestic flight.

“Civil aviation is a extremely regulated industry at some level of the world. In Nigeria the NCAA is the regulator. Each technical personnel, equipment and airport must be certified and monitored by competent regulatory companies. NCAA oversees the activities of all airways, their pilots and crew, airport, navigation aids, all carrier providers including coaching establishments.

“The NCAA considerations guideline requirements for grant of Airline Running Allow, AOP. Amongst different requirement is that every airline operator providing air transport companies for rent/reward will deserve to occupy enough insurance coverage for passenger/cargo and third occasion.

“While these strict regulations are in space to raise airways in review, the regulation of the airports is correct left to the whims and caprices of FAAN, which is no longer presupposed to be so.”

Furthermore talking, a former President of the Nigerian Council of Registered Insurance Brokers, NCRIB, Mr. Babajide Olatunde-Agbeja, stated that the airports extinct to be insured about 10-12 years ago, nonetheless he’s no longer sure in regards to primarily the most as a lot as the moment put.

Olatunde-Agbeja stated: “I recall that the airports extinct to be insured about 10-12 years ago, nonetheless I’m able to’t boom for sure now. As a consequence, the stout brunt of renovating the airport will fall on the shoulders of authorities, which shouldn’t be.

“Survey the least bit of the fires which can possibly be taking place in the markets. Markets are no longer insured. And the entirety falls on authorities. In many conditions, yelp governments would boom, ‘don’t fear, we are able to rebuild the market’. However what of the contents lost? The billions of Naira of contents lost in those market fires?

“We deserve to bring together sure that authorities resources are insured. When I was president of NCRIB, we liaised with authorities they most regularly issued a circular mandating all parastatals, ministries, departments, and companies to bring together sure that all authorities resources are insured. I don’t peek any motive authorities resources may possibly possibly occupy to no longer be insured. Government must insure all their resources, personnel, and liability.”

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