Lagos insures infrastructures for N133bn

By Monsur Olowoopejo

lagos—the Lagos  State Government has insured the Lekki-Ikoyi Link Bridge, roads and other important state-owned infrastructures for N133 billion against terrorists attack and natural disasters.

This was disclosed by the Commissioner for Finance, Mr. Ayo Gbele

fashola-and-bar beach-recla

yi while speaking on the financial activities of the state government in the last one year.

According to him, “Strategic assets such as bridges, drainage channels and roads are now specifically insured against natural disasters and terrorist attacks, amongst others.”

“This action is for the benefit of the residents of Lagos State. This is under the special risk cover against disaster and terrorism. The premium is N247 million for the year and that insures an asset of about N133 billion of the state,” he added.

A breakdown of the insured infrastructures revealed that the cable bridge, Lekki-Ikoyi Link Bridge, was insured for N35 billion.

Explaining the insurance scheme, Gbeyeyi said “You need to remember that in insurance, we tried to cover the replacement cost. Often times, we aren’t dealing with the historical cost of construction (N29 billion).

‘’We are looking at, God forbids, if we have a situation with the bridge. How much will it cost to reinstate it? And that is the figure that I have given you as the insured value of the Lekki-Ikoyi Link Bridge.”

The commissioner noted that this was part of the restructured and optimised Insurance Risk programme of the state which in scope serve as cover for critical assets and staffs of the state.

On why Lagos rating dropped

Gbeleyi also explained the drop in the state’s Fitch rating.

According to him; “On April first, Fitch rating agency slightly reduced the state’s rating in terms of outlook from BB minus stable it was until March 31st, 2015 to BB minus negative.

‘’The rating of any sub-national body will normally trail the rating of the country. The moment the rating agency downgraded the country’s rating, from stable to negative. It is only natural that any sub-national organisation will take a cue from that. The state’s rating is tied to national rating,” he said.

Vanguard