Aviation Insurance: NCAA Advices Insurers on Global Best Practices 

Chinedu Eze

The Director General of the Nigeria Civil Aviation Authority (NCAA), Captain Chris Najomo, has urged insurers who cover risks in the aviation industry to ensure compliance, resilience, and alignment with global best practices.

Najomo made the call during the Civil Aviation Insurance Compliance and Financing Summit organized by the Authority recently in Lagos.

Najomo who identified the objectives of the summit themed: “Securing the Skies: Navigating Aviation Insurance and Aircraft Finance Safeguards,” said the challenges include the definition of practical modalities for retaining key components of existing insurance contracts while transitioning to new frameworks.

In his keynote address, the Minister of Aviation and Aerospace development, Festus Keyamo, stated that airlines must ensure full compliance and transparency in their insurance programmes; insurers must provide capacity, competitive products, and global-standard risk management, and lessors and financiers must remain confident that Nigeria provides a stable investment environment.

In his presentation on Addendum to Prudential Guidelines for Insurers and Reinsurers, the Director Inspectorate, National Insurance Commission (NAICOM), Bankole Ajibola, identified key issues on aircraft insurance, lessors and airlines.

NAICOM also identified key issues about aircraft insurance. These include maximum retention per aviation risk capped at 5 per cent of shareholders’ funds; senior level authorisation for all aviation placements; compliance with international standards, including financial strength ratings; local content requirement and 72-hour occurrence-based reporting requirement.

The Chief Operating Officer of United Nigeria Airlines, Osita Okonkwo, expressed regret that there is no capacity in Nigeria insurance market to structure, arrange, place and underwrite high level of risk for operators, in terms of insuring large body aircraft.