The Nigerian government is actively working to eliminate the burdensome war risk insurance premiums imposed on vessels calling at its ports. These premiums, amounting to a staggering $1.5 billion over the past three years, have been levied by international insurers like Lloyd’s of London despite a significant reduction in piracy incidents in the Gulf of Guinea. The government’s efforts are centered on demonstrating to these insurers that Nigerian waters are now secure, thereby invalidating the rationale behind the hefty surcharges.
A multifaceted strategy is being employed to achieve this objective. The Ministry of Marine and Blue Economy, in collaboration with the Nigerian Maritime Administration and Safety Agency (NIMASA), is engaging in direct talks with key players in the international insurance market, including the International Chamber of Shipping, Lloyd’s of London, and the Baltic and International Maritime Council (BIMCO). Crucially, these discussions are backed by empirical data showcasing the improved security situation in Nigerian waters, aiming to provide concrete evidence of the reduced risk.
Beyond these direct engagements, the Nigerian government is simultaneously bolstering its maritime security infrastructure. This includes continuous improvements to the existing architecture and the sharing of regular, data-driven security reports with international underwriters. This transparency aims to build confidence and demonstrate the government’s commitment to maintaining a secure maritime environment. Regional collaboration is another key component of this approach, with Nigeria seeking to strengthen partnerships on maritime security within the Gulf of Guinea. This collaborative approach aims to address the issue on a broader scale, further enhancing the overall security landscape.
Furthermore, Nigeria recognizes the importance of developing its domestic maritime insurance capacity. By fostering the growth of local insurers, the country aims to retain a greater share of the insurance premiums within its own economy. This strategic move not only contributes to economic growth but also reduces reliance on foreign insurers, enhancing national control over this critical aspect of maritime trade. The government is emphasizing the significant progress made in recent years, highlighting the absence of piracy incidents in the past four years as a testament to the efficacy of its security investments.
The Deep Blue Project, funded by NIMASA and implemented in partnership with the Nigerian Navy and other security agencies, has been instrumental in achieving this improved security. This comprehensive project integrates advanced air, land, and sea assets, enabling real-time surveillance and interdiction capabilities. The successful implementation of the Deep Blue Project serves as a compelling case study for Nigeria’s commitment and effectiveness in combating piracy and other maritime threats.
The Nigerian Shippers’ Council (NSC), acting as the port economic regulator and advocate for shippers’ interests, has consistently called for a review and removal of the war risk insurance surcharge. Recognizing the undue burden it places on Nigerian trade, the NSC is actively engaging with various stakeholders, including international underwriters, the Lloyd’s Market Association, and Protection and Indemnity (P&I) clubs. The Council’s efforts are focused on presenting data-driven evidence that reflects the improved security reality in Nigerian waters, urging a reassessment of the perceived risk and the subsequent removal of the unjustified surcharge. This coordinated effort underscores the collective drive within Nigeria to address this issue and ensure fair and competitive terms for its maritime trade.
