The Nigerian marine insurance market is expanding alongside the country’s blue economy ambitions, but industry experts warn that structural gaps and persistent capital flight are limiting how much value the sector actually retains.
In a recent publication on the International Union of Marine Insurance (IUMI) platform, Lanre Ojuola, director of operations at the Nigerian Insurers Association (NIA), examined the evolving state of the sector, noting that while opportunities in cargo shipping, offshore energy and maritime trade are expanding, local participation remains constrained by long-standing structural gaps.
Ojuola observed that Nigeria’s position as Africa’s largest economy and a key maritime hub in the Gulf of Guinea places it at the centre of growing global shipping and energy activity. However, he warned that a significant portion of marine risks, particularly crude oil exports and liquefied natural gas (LNG) shipments, are still insured offshore, resulting in continued loss of premium income to foreign markets.
According to him, this trend of capital flight reduces the industry’s contribution to domestic economic output and weakens the capacity of local insurers to grow in line with the scale of maritime trade passing through the country.
The publication also highlighted persistent security-related challenges in the Gulf of Guinea, including piracy risks and war risk premiums, which continue to influence pricing structures. It noted that although reported incidents have declined in recent years, insurance premiums have not adjusted proportionately to reflect improved maritime security conditions.
Beyond security concerns, the report pointed to regulatory and operational inefficiencies, particularly compliance complexities under Nigeria’s cabotage regime and delays in claims settlement linked to documentation disputes, which continue to frustrate market participants.
Despite these challenges, the Nigerian Insurers Association (NIA) is leading efforts to reposition the sector through a series of reforms aimed at strengthening domestic underwriting capacity and improving premium retention within Nigeria.
These reforms are anchored on the Nigerian Insurance Industry Reform Act (NIIRA 2025), which introduces measures designed to enhance financial stability, deepen regulatory oversight and promote greater local participation in insurance placement.
The NIA is also advancing digitalisation initiatives to improve claims efficiency, while engaging international partners to build technical expertise in complex risk segments such as offshore energy and marine liability insurance.
One of the key initiatives highlighted is the Container Indemnity and Insurance Scheme, which replaces cash-based port deposits with insurance-backed cover, a move expected to improve liquidity and streamline cargo handling processes across Nigerian ports.
The publication further noted that Nigerian insurers are increasingly adopting stricter underwriting standards and expanding collaboration with international Protection and Indemnity (P&I) clubs to strengthen risk-sharing arrangements on complex marine claims.
It also referenced ongoing efforts to improve market discipline and reduce inefficiencies across the insurance value chain, including enhanced compliance monitoring and technical underwriting reforms.
Industry observers say that if effectively implemented, these initiatives could reposition marine insurance as a more significant contributor to Nigeria’s blue economy ambitions, particularly in shipping, offshore energy and maritime logistics.
However, they caution that progress will depend on stronger regulatory enforcement, improved technical capacity among local insurers and more coordinated collaboration between industry operators and maritime regulators.
