#EndSARS protests: Insuring critical assets to mitigate losses

Except for the Nigerian Civil War, the country has never witnessed the massive destruction that it did during last October’s #EndSARS protests, which set several Nigerian cities on edge, with property worth billions of naira either razed down or vandalised.

The fracas, which was ignited after hoodlums joined the fray in the wake of the shooting at the Lekki Tollgate, saw many private and public buildings and businesses being either partially or completely razed down.

For the record, six soldiers and 37 policemen were killed all over the country during the crisis. Also, 196 policemen were injured; 64 police vehicles were destroyed and 134 police stations burnt down.

In addition, the violence left 57 civilians dead, 269 private/corporate facilities burnt/looted/vandalized, 243 government facilities burnt/vandalized and 81 government warehouses looted.

Some of the several structure/shopping malls and business outfits/departmental stores burnt in some cities, especially in Lagos included Lekki Shoprite Mall, Circle Mall, Surulere Shoprite Mall, Montaigne Mall, Lagos City Mall, and Lagos High Court building.

Others are a structure housing the Nigerian Ports Authority (NPA), local councils offices, public transportation buses (Bus Rapid Transit (BRT) residents of political figures, including past and serving senators and House of Representatives members, one of Nigeria’s oldest state-owned newspapers – The Nigerian Chronicle belonging to the Cross River State government, and the state secretariat of the National Youth Service Corps (NYSC) among others.

Nearly two months after the attacks, individuals, corporate organisations, as well as state governments are still reeling counting their losses.

For instance, while appearing before the Senator Danjuma Goje-led Senate Committee on Marine Transport to defend the 2021 budget last Monday, the Managing Director of NPA, Hadiza Bala Usman, said that the agency incurred more than a billion naira losses to the protests.

As issues bordering on the loss incurred by the agency came up during the NPA’s 2021 budget defence, Usman said that the sum of N807m has been earmarked for rehabilitation of the burnt portion of the agency’s building, adding that this is different from monies to be spent on the replacement of 27 vehicles set ablaze by the vandals and three that were stolen.

“These operational vehicles need to be replaced as soon as the insurance companies come up with the aspect of the loss to be shouldered.

“Aside from burnt building and vehicles, other working tools, like 317 computers as well as photocopiers were looted. The cost of replacement will be above a billion naira when added to the N807million already estimated for the rehabilitation of the burnt building,” she said.

BEFORE the NPA reeled out its losses, the Kogi State government had earlier revealed that it recorded losses worth N40bn to the #EndSARS protests.

Its Commissioner for Finance and Economic Planning and Chairman of the Committee set up by the State Government to determine items stolen from warehouses in the state, Asiwaju Idris, made the disclosure while presenting the report of their findings to Governor Yahaya Bello.

He said hoodlums hiding under the guise of the protests invaded both public and private property and looted COVID-19 palliatives in the state, adding that they also carted away relief materials meant for flood victims, medical, and agricultural items.

The committee also recommended the replacement of the looted items in the North Central state, as well as compensation for private citizens whose stores were vandalised, just as he counselled youths on the need to be more responsible in asking for their rights.

DOWN south, the Cross River State Policy Advocacy Committee (CRS-PAC), shortly after the protest disclosed that it would take the state one year or more, and billions of naira to rebuild government and private-owned property destroyed by hoodlums during the protests.

The committee, a project implementation arm of the Niger Delta Dialogues, which has been working on insecurity in the Niger Delta Region, with the assistance of the European Union, in a statement signed by its Secretary, Mr. Dominic Kidzu, expressed sadness that key infrastructures and service agencies, private homes were either thoroughly vandalised or razed down.

“The Cross River State Policy Advocacy Committee, CRS – PAC, completely, and in no uncertain terms, condemns the orgy of looting and destruction that has wreaked havoc in Calabar …, which has led to the wanton loss of federal, state and private properties. We are pained by the fact that key infrastructure and service agencies, and indeed private companies and homes have been comprehensively devastated in a manner that will take the state at least one full year to rebuild, and will cost billions of naira as well.

“It is regrettable that a state that has been struggling with a dwindling economy with average expendable income plummeting to an all-time low is now saddled with the additional burden of rebuilding public infrastructure with funds that should have been invested on social welfare programmes for the less privileged in the society.

“We note with regret that although the legitimate protest, #EndSARS embarked upon by the youth of Nigeria had been equitably assuaged by federal authorities and the state government. However, hoodlums, miscreants, and thieves still went ahead to invoke a reign of criminality in Calabar, the capital city, the sort that has never been seen before in the history of the state and indeed the country at large,” the group stated.

The state government on its part condemned the attack on facilities in the state, including those at the state secretariat of the National Youth Service Corps (NYSC) by hoodlums.

The state’s Commissioner for Youths and Skills Acquisition, Signor Omang-ldiege, while inspecting the damage at the secretariat described the action as embarrassing, unimaginable and primitive.

“What we are seeing here is like a dream to some of us. Cross River over the years has been a peaceful place known by all, therefore, to have this act done here is unimaginable,” he stated, adding, “one begins to wonder why youths will rise against their fellow youth, no one can imagine the motive behind this. It is unfortunate that despite all that Ayade has done and his efforts to ensure that all is well with youths by making policies that are geared towards improving their lives, some still took to destruction and that is why I feel embarrassed with the attack on the NYSC secretariat,” he said.

While on a visit to the Obong of Calabar, Edidem Ekpo Okon Abasi Otu V, the former Governor of Cross River State, Liyel Imoke, lamented that he was directly affected by the protests that rocked the state capital on October 23 and 24.

Imoke whose wife, Obioma, lost items in her shop, which was vandalised by hoodlums said: “With the events of Saturday (October 24), I had to call the Obong to understand what was going on. I appealed to him and he explained to me what was happening – that Tinapa was even under attack, a situation that is unprecedented in our history. Calabar is a peaceful place. He explained that things had got out of control.”

Addressing the monarch, Imoke said: “We came to get some advice from you before we even set out to look for solutions, to ensure that this never happens again in Cross River State.

“We need your guidance as we go about looking for solutions to the challenge of young people who are unemployed and have grievances; young people who think they don’t have the opportunities others have had.

“We do not understand the extent of the carnage. We are all victims of this incident. If you were not hit directly, you were hit indirectly. For me, I was hit directly. So were very many public officials. They were also hit directly.”

The monarch, in his response, blamed the politicians for the violence saying: “What you people were building has been destroyed. You were building a time bomb gradually and now it has exploded. Now, we are looking for where the problem came from. We know where the problem came from. It is not from those youths; it is the way you politicians handled them.”

The Obong, who said the violence could have been averted if things were done differently, added that security agents failed to stop the violence because they were not treated well.

“The key is that there has to be a change of attitude. Every one of you should have access to the governor (Ben Ayade) and he should listen. Somebody like me who has not gained anything from the political class, my name was said to be on the list of places to attack.

“They wanted to come here, saying he (Ayade) had been sending palliatives to me, that they should come and break this small hut and take everything, and if possible, burn it. My advice is that the administration should have a rethink and work with everybody. From there, everything will calm down and it will end there.”

WITH Lagos being the epicentre of the protest, it was therefore not strange that the coastal state bore the brunt of the crisis, with property worth billions of naira going down the drain.

The Speaker of the House of Representatives, Femi Gbajabiamila, in a statement released on his social media handles after he led a delegation of top western political office holders on a condolence visit to Governor Babajide Sanwo-Olu informed him that the state would need about N1 trillion to fix the damages caused during the mayhem.

“The governor was telling me just now that it was going to cost about a trillion naira to rebuild Lagos. That makes my heart heavy. And I asked the governor what’s the budget of Lagos State? What are you planning? And he told me that they’re planning a budget of about a trillion naira.

“I came in from Abuja today (Sunday, October 25), not just to stand in solidarity with him, but by extension the people of Lagos State. These have been a very difficult few days. It has even been more difficult for me in the last hour. Driving in from the airport and sitting with the governor to watch the documentary here put together, that evidence the carnage we all witnessed. It makes us all very sad,” Gbajabiamila further said.

THE volume of lamentation coming from states that were affected by the protests lends credence to the fact that across the country, governments and individuals have not come to terms with the important role that insurance plays in risk management.

Put differently, the devastation that ravaged the country has, for once, stirred the compelling need for insuring critical national/states’ assets, as doing so would have insulated affected governments from running from pillar to post in search of money to rebuild the destroyed property.

However, some of the factors that militate against the percolation of insurance culture in the country, is the hassles that policyholders have undergone in the hands of insurance companies over the years after suffering losses, as well as the stark absence of insurance outfits in many parts of the country.

This absence at the grassroots perhaps led to the National Insurance Commission (NAICOM), urging insurance brokers to establish their presence in all the nooks and crannies of the country to accelerate insurance penetration and financial inclusion.

The acting Commissioner for Insurance, Sunday Thomas, who gave the advice when a delegation from the Nigerian Council of Registered Insurance Brokers (NCRIB), led by Dr. Bola Onigbogi, paid him a courtesy visit, in Abuja last year, said the vision to have Nigeria’s critical population accept and patronise insurance services can only be achieved if brokers, who are professional intermediaries, extended more of their operations to remote areas of the country, rather than just urban areas.

Thomas also decried the over-concentration of underwriting and brokerage firms in major cities, and their reliance on government accounts stressed that there can’t be effective enforcement of compulsory insurance in the hinterland with the poor presence of operators there.

While assuring of NAICOM’s support in accelerating insurance growth by collaborating with all stakeholders, the commissioner advised operators, particularly brokers, to be more creative in their product development initiatives to make indemnity/protection the first line of consideration by Nigerians, irrespective of their location and financial status.

OVER the years, experts have attested to the importance of insurance in boosting national prosperity, as well as its overarching role in engendering economic development. Specifically, they have also stressed the fact that the more developed and efficient a country’s insurance market is, the greater its contribution to the country’s economic prosperity.

While insurance also helps in stabilising the financial situation of organisations, families, and individuals by indemnifying them against any unforeseen circumstances, some insurance policies, including life insurance can serve as a substitute and, or complement governments’ social security programmes.

Beyond its vital role in facilitating trade and commerce (as many products and services are produced and sold only if adequate insurance is available), insurance can enable risk to be managed more efficiently.

Were all these taken cognizance of, the volume of cries that emanated from a recent event in Abuja would have been minimal.

Speaking to The Guardian at the forum, which took place in Abuja, representatives are drawn from the Manufacturers Association of Nigeria (MAN) Federal Capital Territory (FCT) Chapter; non-governmental organisations (NGOs), as well as Apo Traders Association, revealed that they lost goods and property worth over N2.6 billion to hoodlums during the protests in Abuja.

They appealed to the FCT administration to come to their aid with a view of reducing the loss and pains inflicted on them as a result of the vandalisation.

Narrating their ordeal to the FCT Ministerial Committee on Inspection of Damaged Properties in Abuja, the Chairman of MAN, Abuja, Nasarawa and Niger Branch, Odun Emasealu said: “We were attacked and some factories were severely affected. The FCT minister came to see the extent of damage, especially at our Idu Industrial Layout. Apart from physical structures, machinery was also vandalised and damaged by the hoodlums, but we were also lucky as security agencies later came to our rescue.”

Emasealu, who explained that his equipment and goods worth over N1.5 billion worth in 12 factories and four warehouses in the Idu area of Abuja added: “We may find it difficult to rebuild these factories and warehouses, bear the cost of new equipment or replacing vandalised parts, but we do believe that the government can assist in this regards.”

Yusuf Ohai, a representative of Shelter Initiative for Africa Women, an NGO, equally informed the committee that its members also lost goods worth over N129 million to the hoodlums.

According to him, items carted away by the vandals were not government palliatives but belonged to the NGO. “Bags of beans, cartons of Indomie noodles, several tins of palm oil, and other items that we had at the Idu Estate were all looted.”

On his part, a representative of the Apo Traders Association, Okwelegbe Desmond, said apart from two members, which they lost to the mayhem, they also lost vehicles worth over N932.5 million, as well as cars, vehicles that were either burnt or damaged.

According to Desmond, “Let it be put on record that our association was never part of the #EndSARS movement, nor did we participate in their protests here in Apo Mechanic Village, but we lost vehicles, including cars and trucks, spare parts, warehouses, and block-making machines.”

AS affected members of the public continue to groan over their misfortune, an insurance expert and Managing Director of Arizonal Insurance Brokers, Mr. Obiora Bonaventure, said that under normal circumstances, the government ought to pay compensation to victims of the protest.

He noted: “In our principles of insurance, catastrophic losses are not covered by insurance. So, what happened after the #ENDSARS protest was catastrophic and when a loss is catastrophic in nature, the losses ought to be paid by the government.”

While responding, the Chairman of the FCT Ministerial Committee on Assessment of Damage and Loss of Lives, Abbas Idris, said members of any organisation that fail to have valid insurance policies may not be assisted.

“We need to be assured that all our members are in procession of valid insurance policies. This will further enable us to write our recommendations to the minister, and as we all know, there is no way that the government can bear the entire loss because government revenues have continued to dwindle over time, but affected organisations and individuals who have a valid insurance policy will conveniently find succour in this regard,” Idris explained.

CORROBORATING this, the Head, Corporate Communications and Market Development Department, National Insurance Commission (NAICOM), Rasaq Salami, noted that if all the property losses were insured, concerned insurance firms would rise to the occasion and pay appropriate claims to the victims.

However, “if the goods damaged were not properly insured, then the owners would suffer the losses individually, and it would be difficult for them to come back to business. But if the government supports firms and adequately ensure that their assets and liabilities are insured, the issue of government dipping hands into its coffers for compensation may not arise.”

He, therefore, called on governments at all levels to ensure that all their assets and property are fully insured to reduce losses.

ON his part, the Managing Director of the National Insurance Corporation of Nigeria (NICON) Limited, Muhammad Hussaini, advocated the establishment of a mass insurance scheme that would benefit Nigerians, especially in times of crisis.

Hussaini, who recommended a mass insurance scheme on a benefits basis, in all classes of insurance, stressed that for bodily injuries and deaths, the appropriate regular benefit insurance can be used.

The managing director, who is also the Chief Executive of NICON added that given the large population, there should be a low premium rate on such policies to make them affordable.

He lamented that the nation is yet to harness full insurance potential that would have jumpstarted the economy of affected persons saying, “I must tell you that there is insurance potential here in Nigeria that could be tapped from the industry. Sadly, we are suffering amid plenty. If the insurance industry’s potential is fully tapped, it will not only create jobs running into hundreds of thousands but will also spur the country’s Internally Generated Revenue (IGR),” he noted.

He assured that the Federal Government has a dormant facility that can deal with issues of claims and similar ones adding, “It is interesting to note that the government can provide the funds without recourse to the treasury. However, it would be inappropriate for me to go beyond this point as I cannot speak for the government.”

He appealed to insurance companies to come under the umbrella of the Nigerian Insurers’ Association (NIA) to approach the government to make recoveries.

GIVING his perspectives on why ensuring critical assets has been such a big deal for governments at both state and federal levels, the President, Association of Registered Insurance Agents of Nigeria (ARIAN), Kunle Odewunmi said: “I think insuring critical assets by both the federal and states’ governments is still far below reasonable standards.

“I think that lack of political will on the part of both the federal and states’ government to ensure compliance with government operational procedures on their assets’ management and protection is responsible for this anomaly. Once budgets are approved by the governments at both levels for the protection of likely risks against these critical assets, then a compliance and faithful implementation of insuring those assets should not be a big deal to do the needful by those in position to drive governance.”

On how the country has been set back because a good number of public buildings/structures that were torched during the recent protests were not insured, Odewunmi said: “Anytime the country and states experience such level of unwanted destruction of public assets and infrastructure, and there is no risk prevention/transfer mechanism put in place, it leads to wastage of scarce resources, which are being competed for by various needs that the government is seeking to meet. Glaringly, these losses are being incurred unnecessarily for the simple reason of lack of insurance policies. This is a sad development, and in the long run, the nation will continue to experience a lack of socio-economic assets/infrastructure that is needed for economic development. This inadequacy continues to impede economic growth.

On what difference it would have made if all private and government structures and businesses affected by the fracas were insured, the ARIAN president said: “With working insurance policies in place, given the crystalilisation of insured risks, the insurance company bears the risk by indemnifying the various insured parties.

“So, the difference here is that the insured incurs no financial losses as the insurance company pays claims and puts the insured back in a place he/she was before the losses. Ultimately scarce resources are conserved for better utilisation in other vital areas of governance/businesses.”

Most insurance contracts do not cover damage to property from riots, war, or other forms of force majeure. So, how significant are insurance policies when some risks are not deemed insurable losses? He responded: “I believe that with mutual understanding and agreement by the contracting parties, the insurance company and the insured, most risks can be insured, provided appropriate premiums could be paid.

“If this is made to happen, insurance policies will significantly take care of these risks that are deemed to be uninsurable losses, however, that is not to say that all risks are insurable 100 per cent.”

Across the world, insurance provides security against risks and uncertainty. But despite these benefits, even successful businesses are failing to take advantage of business insurance and insulate themselves from needless losses and consequences. How can this orientation be changed?

“The simple way to change this orientation in my humble opinion is to charge all insurance operators to pay claims promptly whenever due diligence is done and adjudged satisfactory. Once this becomes a general business attitude, the present orientation will fizzle out in no distant time.

“Prompt claims payment is the most important panacea to checkmate the obvious disincentive to insurance patronage in Nigeria. This problem is sometimes caused by some policyholders, who choose not to keep to insurance contract terms, but by and large, I will advise every insurance stakeholder to respect contract terms and practice fairness in their dealings with each other,” the ARIAN boss said.

Since it is common knowledge that the more developed and efficient a country’s insurance market is, the greater is its contribution to economic prosperity, why are Nigerians seeing insurance mainly from the prism of a risk-taking activity? He responded: “There is still a need for more public education/awareness that the insurance sector can add a lot of value to the country’s GDP, through substantial patronage of their risk management services by the private and public sectors.

Over time, efficiently, effectively, and impartially enforcing the nation’s insurance laws and regulation has remained a major talking point. Asked to shed light on the challenges that make the realisation of this an uphill task, Odewunmi said: “The major challenge is still lack of political will on the part of governments. Also, insurance operators seem to have their share of the whole problem. But the government must lead first, then operators will align, that is, if there is no way to circumvent the laws jointly subscribed to by all the stakeholders.”