The Nigerian Shippers Council has entered into a partnership with the National Insurance Commission (NAICOM) in order to open an insurance cover for Nigerian importers and protect them from losing their container deposits.
Speaking at the inauguration of a Technical Committee on Shipping Insurance in Lagos on Thursday, Executive Secretary, Nigerian Shippers’ Council, Barr Hassan Bello said that insurance was a good way to mitigate the risks and additional cost in shipping.
According to Bello, the technical committee has been set up to advise the government on how best to mitigate, in a sustainable manner, the additional cost and risk arising from container deposit, demurrage and detention in Nigeria.
He said that due to the urgency of the exercise, the committee was expected to complete the standard operation and submit its report within two months.
“All the constituents of shipping must be insured, and we will like it extended to more areas like container deposit and issues like demurrage, delivery and many other aspects of shipping.
“Containerisation is the backbone of international trade and the detaining of containers for a long period compels shipping lines to enforce container deposit as risk mitigation measures.
“The staggering amount paid out as container deposit adds to the cost of doing business by shippers, and right now, we have so many empty containers distorting traffic in Apapa due to the need to return them.
“So, we need a saner way, which is done internationally and not only in Nigeria, and so the need for insurance,” he said.
Bello noted that the task of the committee was to address the possibility of securing the viability of the maritime and transport sector through deeper penetration of insurance policy, not just on container deposit but others.
He said that they needed to make insurance a permanent feature in the maritime industry, as the industry was capital intensive, needed investment and had risk attached to it.
Mr Sunday Thomas, Commissioner for Insurance, NAICOM, said that the inauguration of the committee was an indication of their desire to ensure that trade in Nigeria had insurance cover.
According to him, this landmark inauguration shows what relationship between agencies of government can achieve.
“We are quite optimistic of this relationship and we believe that at the end of the two months, the report submitted will be instrumental to deepening of insurance in the country and for the betterment of the economy,” he said.
In her welcome address, Mrs Ada Okam, Director Special Duties, NSC said that the partnership was aimed at cultivating trust, confidence and transparency in the movement of goods and Nigerian trade practises.
She noted that the trade practises had to do especially in the refund of container deposit, which serves as a financial loss to shippers.
“The NSC, as the nation’s port economic regulator, has always paid specific attention to cost moderation, transport infrastructure development and trade facilitation and the development of the maritime industry.
“This is to ensure that the industry serves as an alternative earner to government, especially against unprecedented dwindling in the value chain.
“This journey with NAICOM which started in July is on how best to provide appropriate insurance scheme for the management of risk and additional cost associated with the movement of cargo to, from and within Nigeria.
“Insurance will also provide high value for the maritime sector,”