NIMASA Vows To Eliminate $1.5bn War Risk Insurance On Nigerian-bound Cargoes.
The Nigerian Maritime Administration and Safety Agency (NIMASA) has pledged to eliminate War Risk Insurance (WRI) premiums on Nigerian-bound cargoes, which have cost the country over $1.5 billion in the last three years.
Commitment to Maritime Reforms
NIMASA spokesperson, Osagie Edward, made this known in a statement on Thursday, emphasising that the current leadership, under Dr Dayo Mobereola, is dedicated to improving the ease of doing business in Nigeria.
According to Edward, foreign insurance firms such as Lloyd’s of London and Protection and Indemnity Insurance have imposed excessive WRI surcharges on vessels heading to Nigeria due to past security concerns. However, he stressed that these risks no longer exist, making the continued imposition of these premiums unjustifiable.
Impact of War Risk Insurance on Shipping Costs
Edward highlighted the financial burden of these premiums, stating:
“For a very large crude carrier valued at $130 million, the WRI surcharge per voyage is approximately $445,000. For new container vessels valued at $150 million, the cost rises to $525,000 per voyage.”
While the Nigerian Bureau of Statistics does not have precise data on the total WRI payments made to international insurers, available figures indicate that Nigeria has paid over $1.5 billion in the last three years alone.
NIMASA’s Legislative Mandate
Edward reiterated that the NIMASA Act and the Merchant Shipping Act empower the agency to promote shipping development, and removing the WRI premium has become a key focus of its ongoing maritime reforms.
“The security concerns that originally justified these premiums no longer exist,” he affirmed.
As part of its strategy, NIMASA is working with relevant stakeholders to ensure that international insurers acknowledge Nigeria’s improved security situation, ultimately reducing operational costs for shipping companies and boosting the nation’s maritime industry.
