Three months after the crash of the ill-fated Dana Flight 0992, the foreign reinsurers, who accepted to underwrite 70 per cent of the risk, have yet to commence payment of compensations to relatives of victims, owing to some salient requirements not met by relatives. NIKE POPOOLA reports.
Three months after the crash of the Dana Flight 0992, in Iju, Lagos, on June 3, this year, foreign reinsures of the plane have yet to begin payment of benefits to relatives of the victims, in line with the subsisting contractual agreement.
Although, local underwriters of the aircraft’s risk have commenced claims payment, the payment by the foreign reinsurers are said to be delayed by the failure on the part of relatives of the victims to present the much needed death certificates of victims and letters of administration.
Untidy representation by supposed relatives of the victims, where different people have been coming from the sides of the spouses, parents and extended families of the victims to lay claims, according to the National Insurance Commission, has been causing delay in claims payment commencement by foreign reinsurers.
Prestige Assurance Plc led six other local insurance firms to insure 30 per cent of the aircraft’s risk locally, while the remaining 70 per cent was reinsured abroad by AON Reinsurers of London.
Following the crash of the aircraft, claims payment to relatives of the 153 passengers on board and the crew members were delineated to be paid between the local underwriters of the aircraft’s risk and their foreign reinsurers in the ratio of 70 to 30 per cent.
The local underwriters had undertaken to take up 30 per cent of the risk, while the remaining 70 per cent was ceded to the foreign reinsurers.
However, while local underwriters have been confirmed to have commenced the payment of their 30 per cent quota to relatives of the victims, the foreign reinsurers have yet to make any payment.
Emerging facts have revealed that till date, the local underwriters have so far settled 45 of the 126 beneficiaries involved in the 30 per cent claims payment commitment carved out to the local underwriters.
Even on the 30 per cent claims payment, there are issues still hindering payments. For instance, the issue of multiple claimants, according to the local underwriters, remains a hurdle.
The co-insurers in the consortium of local underwriters include Nem Insurance Plc, Aiico Insurance Plc, Continental Reinsurance Plc, Leadway Assurance Company Limited, Sterling Assurance Limited and Standard Alliance Insurance.
However, the foreign reinsurers, who are to be responsible for the bulk of the payment, our correspondent learnt, have been emphasising on the unmet criteria as reasons for not starting benefits payment to relatives of the victims.
According to industry sources, the reinsurers have relied on the failure of relatives to present these vital documents to put payments on hold.
The Deputy Director, Administration and Policy, National Insurance Commission, Mr. Leo Akah, said that so far, 126 families have submitted documents for the payment of the claims of their deceased ones. He said the local underwriters had already commenced payment on about 30 per cent of what they were entitled to.
He, however, said that the foreign reinsurers, who undertook the underwriting of 70 per cent of the risk, had not commenced payment because the relatives had yet to produce the needed documents required.
According to him, the foreign reinsurers are requesting for death certificates and letter of administration, which the relatives have not been able to produce.
Although he admitted that the process of getting a letter of administration might be cumbersome, he said it was, however, not an insurmountable challenge.
He said, “The relatives are supposed to be paid an initial sum within the first 30 days. But again, there are issues. We have to identify the rightful beneficiaries. Right now, there are multiple claimants showing up.”
The NAICOM official, who said that different people had been coming from the sides of spouses, parents and extended families of the victims to lay claims, noted that such an untidy development had slowed down the pace of payment.
According to him, each relative is entitled to $100,000 (N15.71m), which is the internationally acceptable practice.
He said that the bulk payment of $70,000 (N 10.9m) would be made by foreign reinsurers after the presentation of death certificate and letter of administration.
“Incidentally, they have not been able to make this presentation as a result of the delay. None of those families has, till date, submitted either of these two documents. That is why the issue of the $70,000 cannot be done now,” he said.
In the past, issues of plane crash had been trailed by disagreements between airline owners and disgruntled relatives of victims, as the airlines had always underpaid the relatives.
However, for the first time, NAICOM had been judiciously monitoring Dana crash claims, with promises that none of the claimants would be shortchanged in anyway.
The Commissioner for Insurance, Mr. Fola Daniel, said that the lead insurer of the aircraft, Prestige Assurance, was responsible for the claims payment.
Daniel said, “Thirty per cent was insured in Nigeria, and we have a lead insurer, Prestige, which had assured us verbally and in writing that there was no problem; that they would pay the claims.”
According to him, the cause of the slow pace in the payment of the initial 30 per cent of the claims is the issue of multiple claimants coming up.
He said that in some cases, at least, 10 individuals had come forward to claim that they were the rightful beneficiaries of the settlements.
In as much as the insurers were ready to pay, Daniel said that it was important to ensure that the right families were paid.
The Managing Director, Prestige Assurance, Mr. Anand Mittal, told our correspondent that so far, some of the relatives had collected the 30 per cent settlement of the claims of their family members involved in the crash.
He also explained that Prestige used to retain only 10 per cent of the risk in the country, but only recently increased it to 30 per cent because of the Local Content policy of the government.
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