By Adeleye Kunle
The country’s demand for insurance coverage against kidnapping, terrorism, cybercrime, and ransom payment is increasing.
Despite President Muhammadu Buhari’s signing of the Terrorism (Prevention and Prohibition) Bill, 2022, which prohibits the payment of ransom to abductors, kidnappers, and terrorists for the release of any person who has been imprisoned, the crime has continued with ransoms paid.
The increase in insurance demand coincides with Nigerians becoming more insecure as a result of security agencies’ inability to combat crime.
However, there are concerns that providing this coverage will encourage criminal elements in the country to commit even more crimes.
Furthermore, experts are concerned. That is why they warn insurance companies to be cautious when providing insurance coverage for these crimes in order to avoid burning their fingers when claims arise.
Mr. Ben Ujoatuonu, Managing Director of Universal Insurance Plc, stated that terrorism, kidnapping, cybercrime, and ransom payment have become major risks, prompting people to seek insurance to protect themselves.
He stated that insurers must carefully examine the insurance to ensure that it is a risk they want to take because of the high frequency, exposure, and severity.
He stated that every society strives to put measures in place to ensure that its laws are followed, but that despite this, some people are determined to break the laws.
He stated that one of the government’s responsibilities is to protect lives and property while also creating an enabling environment for businesses to thrive.
“What this also does is reduce the elements of crime and criminality within the economy,” he said. However, if you look at our system, you will notice that we have been experiencing a kind of collapse in our security apparatus over time.
“So, since everyone is on their own. There is nothing people can do but solve the problem themselves, which is why the ransom issue has made the criminal act a very profitable business. However, it has become a significant risk, and it is not surprising that people are seeking insurance to protect themselves against such risks.
“It is a very serious issue, and I believe insurance companies need to look into it thoroughly to ensure that it is a risk we want to take because of the high frequency, exposure, and severity.” We must make certain that we have enough statistics to work around the risk. It is a difficult situation because what we have in our climate differs from what is happening in other climates. Yes, there have been terrorist acts, but the issue of kidnapping, ransom, and organ harvesting has gone beyond the scope of terrorism.
“The road from Enugu to Port Harcourt is not safe.” It’s the same from Abuja to Kaduna, Ijebu-Ode to Benin, the Lagos-Ibadan Expressway, and many other routes throughout the country. As an insurance professional, I will proceed with caution because the likelihood of those risks occurring is 95 percent,” he stated.
Samuel Ogunnusi, Chief Underwriting Officer at Allianz Nigeria, confirmed that kidnap insurance is on the rise.
He stated that his company was attempting to provide the policy, but that they had yet to obtain National Insurance Commission approval (NAICOM).
“Yes, there is a demand for kidnap insurance.” Some of our multinational corporations in Nigeria have requested it, but it is not yet ready. We will not be able to provide it until we receive approval.
“Kidnapping occurs in cyberspace as well. We have cases where someone will hack into your system, kidnap it, and demand a ransom.”
He also stated that the policy provision may not encourage crime because the policy is treated as confidential, noting that it will not be known that company A and B has the cover.
