A Lagos State High Court has ruled in favour of IRS Airlines Limited in a long-running insurance dispute against 18 Nigerian insurance companies, ordering the insurers to pay millions of dollars over the loss of one of the airline’s aircraft.
The judgment, delivered on February 12, 2026, by Justice K. A. Jose of the Lagos State High Court (Commercial Division), resolved Suit No. LD/3187CMW/2017 filed by the airline following the total loss of its Fokker 100 aircraft (registration 5N-SIK) in an accident in the Republic of Niger on May 10, 2014.
The court held that the insurers wrongfully refused to indemnify the airline for the loss despite a valid insurance policy covering the aircraft.
Court Awards Millions in Damages
The court awarded damages against the insurers based on their respective liability shares under the policy. The lead insurer, Standard Alliance Insurance PLC, was ordered to pay approximately $3.65 million, while Industrial & General Insurance was ordered to pay $200,000 and Mutual Benefit Assurance $150,000, among other awards against the remaining defendants.
The court also granted interest at 21 percent per annum from May 2014 until the date of judgment, and 6 percent per annum thereafter until full payment.
Reinsurance Terms Not Binding
In its ruling, the court declared that the reinsurance terms arranged by the lead insurer with foreign underwriter Rosgosstrakh Limited were not binding on IRS Airlines, as they were not incorporated into the direct insurance contract with the airline.
The court further held that the insurers’ reliance on those undisclosed foreign terms to deny the claim violated Section 55(2)(a) and (b) of the Insurance Act 2004 and constituted a breach of the insurance agreement.
Investigation Declared Invalid
Justice Jose also ruled that the insurers’ investigation into the accident was flawed because a foreign loss adjuster was appointed without the approval of the National Insurance Commission (NAICOM) and without collaborating with a licensed Nigerian loss adjuster, contrary to provisions of the Insurance Act.
As a result, the investigation report used to reject the claim was declared null and void.
Policy Covered Six Aircraft
Court documents showed that the insurance policy, which ran from July 7, 2013, to July 6, 2014, covered six aircraft operated by IRS Airlines, including the crashed Fokker 100, with an agreed value of up to $5 million per aircraft for risks covering flight, taxiing and ground operations.
The aircraft was returning to Nigeria after undergoing a C-check maintenance abroad when it experienced navigational problems mid-flight, forcing an emergency landing in Niger Republic that resulted in its total loss. There were no fatalities.
Counterclaim Dismissed
One of the insurers, Wapic Insurance PLC, had filed a counterclaim seeking to have the policy declared void over alleged breaches by the airline. However, the court dismissed the claim and upheld the validity of the insurance contract.
Airline Welcomes Judgment
Reacting to the ruling, Managing Director of IRS Airlines, Yemi Dada, described the decision as a major vindication of the airline’s position.
He said the judgment confirmed that the airline had complied with all policy obligations, including full premium payments, prompt notification of the accident and full disclosure of relevant information.
According to him, the ruling also provides relief after years of financial strain, including debts owed to the Asset Management Corporation of Nigeria (AMCON) resulting from the unpaid insurance claim.
Dada added that the judgment reinforces the rule of law in insurance contracts and protects policyholders from unfair claim denials based on undisclosed foreign arrangements.
Industry observers say the ruling could set an important precedent for Nigeria’s aviation insurance sector by emphasising transparency, proper incorporation of policy terms and compliance with local regulatory requirements in claims investigations.