2020 EndSARS RIOT SHOCKER: Insurance Experts Say NPA Can Claim N1Billion Loss, Doubt Payment

Even as insurance firms are gradually coming to terms with the enormity of the claims that they would have to pay on account of last year’s #EndSARS protest, they have also red-flagged Nigerian Ports Authority’s claim of about N1Billion.

Shipping Position Daily recalls that the managing director of the Nigerian Ports Authority; Hadiza Bala Usman had last December claimed that the agency incurred more than a billion-naira loss to vandalism during the October 2021 #EndSARS protests in the country.

The issue on losses that the NPA suffered as a result of the vandalism during the riot came up during the 2021 budget defence session at the Senate by the Committee on Marine Transport.

The NPA managing director had told the committee that N807million had been earmarked for the rehabilitation of the burnt portion of the agency’s building.

This, she added, was different from the money to be spent on replacement of 27 vehicles that were set ablaze by the vandals and three others stolen.

Usman said: “These vehicles were operational ones, and they need to be replaced as soon as insurance companies come up with the aspect of losses to be shouldered.

“Aside the burnt building and vehicles, other working tools like 317 computers were looted as well as photocopiers, and the cost of replacing them will be above N1billion when added to the N807million already estimated for the rehabilitation of the burnt building.”

Even though sources in the insurance industry acknowledged that NPA lost hugely during the protest, they argued that the agency is mixing things up by calculating cost of reconstructing the burnt building and purchasing new vehicles.

One of our sources also disclosed that the estimated claims from the Nigerian Port Authority was about N1bn, next to retail giants; Shoprite Nigeria which was about N2bn.

The source added that the N2Billion is from the estimated N9.7Billion that 14 insurers are expected to pay as #EndSARS riot claims.

It was confirmed that, about 1,036 individuals and corporate organisations that recorded losses during the protests have lodged claims through 14 insurance companies and 667 of the claimants are from Lagos.

Without giving details, the Director-General, Nigerian Insurers Association, Mrs Yetunde Ilori, said the insurance companies were already responding to the claims of their customers, even as she added that the association was already collating the claims from the losses.

But, many experts who spoke to our correspondents affirmed that, apart from the mix up movable assets and immovable ones by the NPA, what the agency may likely get will depend on the whether its package covers riots and civil commotions.

According to the Public Relations Officer of Nigerian Council of Registered Insurance Brokers, Mr. Tope Adaramola, there is an exclusion clause in insurance for riot and civil commotion, he added that unless NPA has an extension of cover for riots and civil commotion, it may likely not get paid the N1Billion.

According to him, “there is an exclusion clause in insurance for riot and civil commotion, so unless they have an extension of cover for riots and civil commotion, so that means that, as it has happened now, they will not be paid but some companies are wise they will have taken that as an extension to their policy,  so if they take it as an extension and it happens like this, the insurance firms will pay, but if it does not, they lose out, unless the insurance company just want to give them something for the sake of not looking wicked. I believe NPA has insurance department and I believe the professionals there would have done that”, he said.

Also speaking the Managing Director of Guinea Insurance, Mr.  Polycrap Didam said although the destruction is a monumental loss for the insurance industry, he also confirmed that, it will be difficult for the management of NPA to get anything from insurance companies.

In his words: “It is a monumental loss, coming again in the background of recapitalization where the company needs money badly, again like I said insurance exists to protect against losses

“As to whether there is riot and civil commotion extension, I don’t know the policy, I don't know what it covers, but if there is no such kind of extension, it is going to be a bit difficult”. 

When asked if it is the insurance company that will bear all the loss he stated that, “normally when there is a policy, there is always a part issue, a portion of the policy they will have to bear, of course for the insurance company they don’t have to cover it alone, they have re insurance capacity they know that they will also fall back on

Insurance, as you know is the process of spreading risk, you will be surprised that this risk is also covered by the international markets, so it’s not insurance company in Nigeria alone that is going to suffer for it, a lot of people will have to come on and make good  the loss”, he concluded.

However, on his part the Director General Nigerian Insurers Association (NIA) Mr. Sunday Thomas stated that insurance is established to pay benefit to those who are victims of circumstances of nature, stressing that what the industry should be concerned about is whether the building is adequately insured.

“I wonder why people talk about loss, insurance is established to pay benefit to those who are victims of circumstances of nature, what we should be concerned about is that was it  insured or was it adequately insured, is not whether somebody is losing or not, insurance exist so that other institutions can continue to exist, insurance exist so that business can be restored, insurance exist so that call those who are depending on those individuals that may die in the process can have some financial benefit to suit their pains, so don’t talk about losses, it is for those reason of the losses that insurance exist, what we should be concerned about Is whether or not those facilities are adequately and properly insured.

“Then I have some people talk about crisis whether it is civil, commotion and the rest of that, there is what is called extended cover, as long as d extended cover is there they will get their benefits, I have gotten assurance from most of the insurance company that are involved in all this to the fact as many as the companies or shops that were looted or destroyed are properly and adequately insured they will get their benefits and also promptly. As we speak right now laws adjusters are on the field looking at the extent of the damage so nobody can give a figure and number right now until they have finished their job”.