Insurance of crashed Associated Airlines’ aircraft not clear

Four days after an Associated Airlines’ aircraft ferrying home the late Ondo State Governor Olusegun Agagu’s body crashed in Lagos killing 14 people, the insurance position of the airline and expected compensation were still not clear.

This is as no local insurer or broker has identified with the airline’s insurance, after an unidentified name, Sema Insurance, was said to have insured the crashed plane with Nigeria Re.

This is even as Nigerian Reinsurance Corporation (NigRe) which was mentioned by aviation authorities as connected to the crashed plane has denied any involvement, raising concern about the compensation for the losses.

Local operators are, however, shocked that the risk which by law was supposed to be placed locally with domestic insurers or brokers until local capacity is exhausted, could migrate abroad to an unknown company (Sema).

BusinessDay investigations reveal that the Nigerian Insurers Association (NIA) worried that no local insurer has declared involvement with the crashed plane has written to the Nigerian Civil Aviation Authority (NCCA) to furnish it with details of the airline’s insurance.

Section 65 (7) of the Insurance Act 2003 stipulates that a person who intends to insure a Nigeria based asset has to place the risk with a Nigerian registered insurer. Any reinsurance of such risks is to be placed within the country and can only be ceded where the local capacity is inadequate.