A former Director-General of the Nigerian Maritime Administration Safety Agency, Temisan Omatseye, has described the war risk premium on shipping as global fraud.
Speaking at the Taiwo Afolabi Annual Maritime Conference in Lagos recently, he claimed countries kept paying the war risk premium without getting claims.
“You do not see it because it is an invisible charge, but it is built into your cost. And somebody is collecting that money. So, I insist that the war risk premium is a fraud and I will stand by it,” he said.
War risk insurance is an insurance policy that provides financial protection to the policyholder against losses from events such as invasions, insurrections, riots, strikes, revolutions, military coups, and terrorism.
Omatseye said that as of 2009, Nigeria was paying $400m annually on war risk insurance.
He said: “When I was the DG of NIMASA, I was approached by Nigerian Liquified Natural Gas that the money they were paying for war risk premium was too high. At that time, in 2009, Nigeria was paying $400m a year. That was just on LNG vessels and light carrier vessels, but not a single claim has been made.”
According to him, some people sat at Lloyd and formed a war risk committee, which makes decisions.
Omatseye further said it was unfortunate that Nigeria had handed over its destiny in the shipping industry to foreigners, stressing the need for the country to start developing its local capacity.
In his welcome address, the Chairman of SIFAX Group, Dr Taiwo Afolabi, represented by the Managing Director of Skye Capital, Mr Bode Ojeniyi, stated that the country’s maritime industry was grappling with various issues, including infrastructural deficit, foreign exchange bottleneck, and insecurity on Nigerian waterways.
He also listed low technology adoption and deployment as well as inconsistent policies as some of the challenges the sector was grappling with.
“The TAAM Conference was birthed to serve as a platform where key issues that will engender innovations and practical ideas needed to sustain the growth of the maritime sector are discussed and workable solutions are proffered to challenges confronting the sector,” he said.
The Secretary-General of the African Shipowners Association, Funmi Folorunsho, said, “The available vessels in the country are not the required specification needed for the available trade. A national shipping line is not what we need now, but a Nigerian shipping line.
