Nigerian-bound shippers can cut no less than an average of N77billion off their annual shipping costs from the removal of war risk insurance thereby making the country’s import business much more competitive than it is currently.
Director general of Nigeria Maritime Administration and Safety Agency (NIMASA), Dr. Bashir Jamoh, who revealed this in Abuja yesterday, said this cost if removed, would translate to cheaper cost of imported good for Nigerians and also improve the country’s ease of doing business.
Dr Jamoh who spoke during a courtesy visit to LEADERSHIP in Abuja, noted that Nigeria’s fight against insecurity in nation’s waterways especially the Gulf of Guinea has yielded so much positive impact thus resulting in falling piracy incidences in the Nigerian waters and the Gulf of Guinea.
According to him piracy in Gulf of Guinea reduced drastically NIMASA deployed the Integrated National Security and Waterways Protection Infrastructure popularly known as the Deep Blue Project.
He revealed only 10 incidences of theft was recorded for the whole of 2020, hence the need to launch the campaign for the removal of the War Risk Insurance.
According to nonprofit Oceans Beyond Piracy’s 2020 reports, the total cost of additional war risk area premiums incurred by Nigeria bound ships transiting the Gulf was $55.5 million in 2020 alone, and 35 per cent of ships transiting the area also carried additional kidnap and ransom insurance totaling $100.7 million.
Insecurity got so bad in the region before the deployment of the deep blue project that global insurance firm Beazley now offers “Gulf of Guinea Piracy Plus,” a bespoke insurance plan for maritime crew travelling through the area.
The plan provides compensation for illegal vessel seizures and crew kidnappings even in the absence of ransom demands. It tracks insured vessels on a 24-hour basis, but because the risks are so high, it limits claims to $25 million.
Jamoh Calls For Removal of War Risk Insurance On Nigerian Bound Cargoes(Opens in a new browser tab)