Local Firms’ Low Capacity Sustains Foreign Insurers’ Grip on Nigerian Airlines

Experts have identified low capacity and high premium as factors that have continued to compel Nigerian airline operators to seek insurance coverage abroad despite the federal government’s local content law and National Insurance Commission’s (NAICOM) directive on aviation insurance in Nigeria.

The situation thus, has positioned aviation insurance as a major channel for foreign exchange outflows.
Some insurance and airline operators attributed the development to the high level of risk in Nigeria, compared to some other countries.

Speaking in an interview with THISDAY on the matter, the CEO of Aero Contractors, Captain Ado Sanusi, said one of the reasons Nigerian airlines prefer to insure their aircraft with foreign companies is because of capacity.

He explained that the local insurance companies do not have the capacity and that is why it takes a bit longer time to pay claims when they come.

THISDAY, September 11, 2018

 

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