Dangote Industries Ethiopia received a 10.7 million Br insurance compensation from Nyala Insurance for business interruption and damage it faced in November.
The company’s cement plant operations were interrupted on November 15, 2018, due to troubles with the conveyor belt, which transports gravel and sand to the cement plant. The 10Km belt conveyor transports the raw materials from the nearby quarry to the plant, which is located in Mugher, Adebern Wereda, Oromia Regional State. Last November, the conveyor snapped, forcing the company to cease operations for 20 days.
The insurance firm paid the claims of a full insurance policy including all assets risks, machinery breakdowns and business interruptions on March 20, 2019, at its headquarters located on Mickey Leland Street.
Four million Birr in compensation was paid for the damage to the belt, while the remainder was paid for losses the company suffered due to interruptions in its operations.
Investigation of the losses and damages was conducted by a private firm, according to Nebiyat Markos, engineering service manager of Nyala. Nayala has reported the highest profit in the industry for two successive years, registering 141.3 million Br in net profit last year.
Established nearly a quarter of a century ago, Nyala, whose assets reached 1.9 billion Br and operates with 315 staff and 45 branches, paid 163.5 million Br in claims for general and life insurance in the last fiscal year.
The insurance firm’s prompt response was a positive signal for Dangote, which is aggressively moving into the Ethiopian market, according to Danillo Trugillo, country manager of Dangote. The company’s cement plant became operational four years ago following a 600 million Br investment.
“The insurance firm’s backing gives us confidence in our endeavours,” said Danillo, whose company produces 2.5 million tonnes of cement a year from its plant that employs 1,000 people.
Dangote, one of 21 cement factories in Ethiopia, has faced various attacks for the past couple of years. In 2016 protesters attacked and vandalised Dangote’s cement plant and burned down vehicles and machinery of the company. Last year gunmen killed Dangote’s former country manager, Deep Kamara.
For these damages, the company did not receive any compensation, according to Folahan Durotola Orimoloye, country head of risk management at Dangote Industries, which is owned by Africa’s richest man, Aliko Dangote. Dangote is a multinational conglomerate that works in the cement, sugar, oil refining and real estate industries, employing over 30,000 people and generating 4.1 billion dollars in revenue in 2017.
“We didn’t buy insurance policies for political risk,” Folahan said.
Habib Mohammed, a financial expert with a decade and a half of experience, sees the payment as setting a precedent.
“Many companies only buy damage insurance policies,” said Habib. “They don’t have a culture of buying policies for business interruption.”
PUBLISHED ON Mar 23,2019 [ VOL 19 , NO 986]
Radar | Aug 24,2019
Radar | Apr 30,2021
Radar | Jan 31,2021
Fortune News | Feb 11,2023
Radar | Oct 30,2021
Radar | Jan 01,2023
Covid-19 | Mar 19,2020
Radar | Jul 25,2020
Agenda | Jan 01,2023
Radar | Dec 25,2021
Dec 24 , 2022
Biniam Mikru heads the department of cabinet affairs under Mayor Adanech Abiebie. But...
Jul 2 , 2022 . By RUTH TAYE
On a rainy afternoon last week, a coffee processing facility in the capital's Akaki-Qality District was abuzz with activ...
Nov 27 , 2021
Against my will, I have witnessed the most terrible defeat of reason and the most sa...
Nov 13 , 2021
Plans and reality do not always gel. They rarely do in a fast-moving world. Every act...
Leaders of the National Election Board are in a charm offensive mood, of a sort. Last week, they organised a rare tour for members of the me...
When the country's most senior diplomats and envoys return back to their posts after two-week debriefings, they leave behind a point or two...
Dec 2 , 2023
The symphony of traffic noise in Addis Abeba is not just a sign of life, but a siren...
Nov 25 , 2023
Ethiopia's quest to develop a functioning capital market is a demanding yet not unach...
Nov 18 , 2023
Prime Minister Abiy Ahmed (PhD) has made a fervent call for landlocked Ethiopia to ga...
Nov 11 , 2023
In November last year, a ray of hope pierced the gloomy skies of Ethiopia as the Pret...
I have a love-hate relationship with my phone. It is my go to source for information. I enjoy interacting with text messages and browsing t...
Over the weekend, I attended a wedding where my husband was one of the protocols. Despite the typical joy...
Or see contact page