Nigeria wants removal of War Risk Insurance for Gulf of Guinea

Nigerian authorities are lobbying for the removal of the war risk insurance required for cargo vessels that call at the country’s ports, a surplus demanded because of the enormous growth in recent years of kidnapping incidents on vessels transiting the Gulf of Guinea.

The Nigerian Maritime Administration and Safety Agency (Nimasa) Director General Bashir Jamoh called on the international shipping community to remove the premiums. He said that the country had demonstrated enough commitment towards tackling maritime insecurity in its territorial waters and the wider Gulf of Guinea. “We therefore invite the international shipping community to rethink the issue of war risk insurance on cargo bound for our ports,” he said.

Nigeria has heavily publicized its intentions to reduce the degree of piracy, with kidnappers throughout the Gulf tending to use parts of Nigeria upriver to hold on to kidnapped seafarers. The country recently formally launched the Integrated National Security and Waterways Protection Infrastructure, also known as the Deep Blue Project. Jamoh said that this was a clear commitment that Nigeria was tackling the piracy menace along its coasts.

Nigeria said that it had invested $195m to acquire military and law enforcement infrastructure to secure its maritime domain along the Gulf of Guinea. “Since the deployment of the deep blue project assets in February, there has been a steady decline in piracy attacks in the Nigerian waters on a monthly basis,” Jamoh said.

Marine insurers were claimed to be continuing to insist on very high premiums for ships conveying cargo to Nigeria.

Oceans Beyond Piracy’s 2020 report indicated that the total cost of additional war risk area premiums incurred by Nigeria-bound ships transiting the Gulf of Guinea was $55m in 2020, while the 35% of ships transiting the area also carried additional kidnap and ransom insurance totalling $100m.

However, from January to March this year the Gulf of Guinea accounted for 43% of global piracy incidents. The pleas from the Nigerian authorities looked likely to obtain a “wait and see” response from insurers, who are unlikely to drastically drop rates based on a three-month decline.