Spatial Analysis of Fire Insurance Claims and Risk Zoning in Lagos Metropolis

This study conducts a spatial analysis of fire insurance claims and develops an actuarial risk zoning framework for Lagos Metropolis, South West Nigeria. Lagos is Nigeria's largest commercial city and hosts the country's highest concentration of insured property. Fire claims represent one of the largest loss categories for property insurers operating in Lagos, driven by electrical faults, petroleum storage risks, and dense informal settlement patterns. Geographic risk differentiation in fire insurance pricing is largely absent from current Lagos market practice. This study uses georeferenced fire claims data from four property insurers and the Lagos State Emergency Management Agency for the period 2018 to 2023, combined with building density, land use, and infrastructure quality data from the Lagos State Geographic Information Systems Authority. Kernel density estimation and spatial autocorrelation analysis are applied to identify fire risk hotspots. Risk zones are delineated based on claims frequency, severity, and spatial clustering patterns. Findings reveal statistically significant spatial clustering of fire claims in Mushin, Alimosho, and Apapa local government areas, with risk levels in these zones approximately three times the Lagos average. Electrical fault-related claims are concentrated in areas with weak electricity infrastructure. The study concludes that spatial risk zoning significantly improves fire insurance pricing accuracy in Lagos. It recommends that insurers adopt GIS-based risk zoning in property underwriting and work with Lagos State planning authorities to share loss data for urban risk management.

Keywords: spatial analysis, fire insurance, risk zoning, Lagos, GIS.