Arik Air, Old Mutual Sign N2.5bn Add-on Passenger Insurance Deal

Nigeria and West Africa’s largest carrier, Arik Air and Old Mutual Nigeria General Insurance Company Ltd yesterday signed an add-on optional passenger insurance deal capable of yielding an annual gross value of N2.5 billion if all of Arik’s average of 7,000 passengers per day subscribe to the scheme.

The deal entails a N1,000 premium paid online by passengers who choose the policy to cover for accidental damages to luggage and body, flight cancellation, flight delay of up to eight hours and more.

At a press conference to introduce the insurance programme, as well as mark the carrier’s 9th anniversary, Arik Air’s managing director, Mr Chris Ndulue said, all a passenger needs do is to buy an Arik Air ticket to any destination in Nigeria online, then buy an air travel insurance for just N1,000 using Verve Card, MasterCard or Visa Card.

He maintained that the scheme is optional to passengers and can be done only online, as extending it to physical processing could create a clog when purchasing tickets.

The insurance policy provides cover against personal accident up to N1 million, resulting in death, permanent disability or bodily injury within 90 days of the occurrence of the accident.

“The cover is from airport to airport whilst aboard Arik Air.

The benefits also include N20,000 for flight cancellation or delays of more than eight hours; emergency medical expenses, up to N50,000; mishandled/missing baggage (inconvenience), up to N20,000; and damage to baggage, up to N20,000 per passenger,” he said.

He further clarified that this insurance is only an add-on to provide passengers additional relief and not the same as the normal cover guaranteed for all passengers in case of air crash as provided for by the International Civil Aviation Organisation (ICAO) regulation, captured in the Passenger Bill of Rights.

The insurance scheme is brokered by Risk Analyst Insurance Brokers Limited.

“We have been in the process for quite a long time. There is a gap in aviation sector of the economy in terms of insurance need. We find out most times, passengers don’t get compensated for flight delays, cancelled flights and lot more. This policy will make passengers appreciate the value of insurance when there is flight delay and loss of baggages for which they are usually paid,” said Mrs Funmi Babington-Ashaye, managing director Risk Analyst Insurance Brokers Limited.

Also commenting on the scheme, the managing director of Old Mutual Nigeria General Insurance Company Ltd, Rachel Emenike, said the company was determined to add value to air passengers and that she is hope the policy will be well embraced.

Speaking on the carrier’s operations these nine years earlier, Arik’s boss, Mr Ndulue said from lifting 29,363 passengers in the first year, with only four aircraft when the airline started in October 2006, it has lifted 17.3 million passengers as at today and have acquired a total of 28 aircraft running 19 domestic and 12 regional and international flights.

He also disclosed plans by the airline to become listed in the Nigerian Stock Exchange (NSE) in the next two years.

“We plan to do a private placement in the first quarter of 2016 and listing on the NSE in 2017. Part of our plans for 2016 will also include our launching of Lagos-Rome-Lagos operations and to start daily Lagos-JFK-Lagos daily operations.

“With a staff strength of 3,000 directly employed Nigerians, we will be extending our Abdijan operations to Dakar from mid-November and we are starting operations to Libreville (Gabon) in the first quarter of 2016,” he said.

Towards these plans, Ndulue said his airline will acquire in 2016, two Q400s, two CRJ 1000s and two A330-200 aircraft.

source: Leadership