Omosehin Explains Reasons for Compulsory Aviation Insurance Law in Nigeria

Ebere Nwoji

The commissioner for Insurance, Segun Ayo Omosehin has explained reasons for compulsory insurance of aircrafts leaving the shores of Nigeria, saying the whole essence was to create local content to protect the economic interest of Nigeria.

Omosehin also noted that innovations in the aviation system such as the evolving landscape of the aviation sector, marked by advancements like electric and hybrid aircraft, predictive maintenance, and automation of air traffic control systems, come with new risks that require robust insurance mechanisms to mitigate.

He stated this at the Chinet Aviacargo 2024 Conference in Lagos in which aviation insurance stakeholders called for NAICOM’s review of its aviation insurance policy to ensure that airlines stop paying double premium further explained that certain laws were made by a country to protect certain aspects of its economy, noting that the whole concept was to create local content to protect the economic interest of Nigeria.

“It is aimed at protecting the economic interest of that nation. And before I come to aviation, I will go to a slightly bigger one which is the local content policy that was announced for the Nigerian oil and gas sector. Prior to the enactment of that law, most of the oil majors in this country that were operating in Nigeria never believed there was anything good about Nigerians. As a matter of fact, crudes were imported from abroad to Africa, up to the point when we then had to wake up” he explained.

He said insurance plays critical role in aviation industry, noting that the future of the aviation industry was  full of potential, but with that potential comes the need for comprehensive risk management strategies.  

According to him, these risks are managed through global risk transfer mechanisms like reinsurance, which spread risks across continents, ensuring resilience in the face of unforeseen events.