Insurance industry experts have called on the National Insurance Commission (NAICOM) to review the current regulation, which limits total insurance cover for aviation at the maximum of 5 per cent shareholding funds.
The players in the industry said the review of this would spur growth in the Nigerian aviation industry, while also increasing economic activities in the country.
They made the call at an Aviation and Cargo Conference in Lagos with the theme: ‘The Role of Insurance Regulation in the Growing Aviation and Cargo Business in Nigeria’.
Aviation insurance is considered as a special risk and the premium is said to be high because of the high risk associated with the business.
In their various presentations at the conference, the insurance experts said, the limited insurance cover for the sector as stipulated in the law should be given a second thought.
The Director, Policy and Regulation, National Insurance Commission NAICOM, Mr. Leo Aka who represented the Chief Executive Officer of the Commission called for more capital injection to enable more local retention and licensing of more local reinsurers to address some of the major challenges facing aviation insurance in Nigeria.
These he listed to include, sabotaging local content Act requirements, accusation of high premium rates – Airline Operators of Nigeria (AON), Nature of reinsurance cover among others.
Managing Director of one of the insurance companies Mr. Edeki Isujeh raised the issues of access to the dollar for the payment of premium and called on the insurance regulator to liaise with the Central Bank of Nigeria for a special window.
Organizer of the conference, Mr. Ikechi Uko said, the event is meant to bring together airline operators and the Insurance companies to address the growing perception of exploitation of airlines by Nigerian insurance companies and the alleged use of the law to prevent them from using foreign insurers when they lack adequate capacity to insure a brand aircraft but still charge high premium.
Reporting by Nosa Aituamen, editing by Fany Olumoye, Omotola Oguneye