Insurers Target Informal Sector

Insurance companies inGhanaare strategizing to make life insurance more attractive to the public, especially the informal sector.

A recent study conducted by Fin Mark Trust, an Irish market research organization on the directive of Ghana’s National Insurance Commission (NIC), indicated that more than 23 million Ghanaians have not signed onto any form of insurance product.

It was established that only five per cent of the country’s 24 million people had signed onto mainly the mandatory motor insurance and a few life insurance policies.

Currently insurance penetration in sub-Saharan Africa is very low with Ghana, which is adjudged the lowest, with less than two per cent compared to South Africa’s 14.8 per cent and Namibia’s 7.3 per cent.

Kwame-Gazo Agbenyadzie, president of the Ghana Insurers Association (GIA), speaking at the maiden life Insurance conference themed: “Life Insurance Agenda 2012: expanding the frontiers and benefits of life insurance in Ghana,” admitted that the industry was dealing with a number of challenges which need to be addressed in order to improve upon the quality and penetration of service delivery.

“As practitioners, we are very optimistic about the future of our industry given the positive socio-economic developments in our country. There are bound to be new challenges and greater demands on us as insurance practitioners.”

He mentioned that “there are developments currently ongoing to improve the regulatory regime such as the development of a new insurance bill and regulations, code of practices, a risk based supervision modeled to adopt international standards, among others to ensure that the insurance industry in Ghana lives up to a higher standard of professionalism in its operational and management practices.”

The GIA, he stated, was committed to working with the National Insurance Commission (NIC) and Ghana Insurance Brokers Association to carry out an evaluation of the industry, adding, “We would discuss the things we could be doing in order to improve the image, reputation and continues viability of our industry.”

In a speech read on his behalf, President John Evans Atta Mills noted that the outlook of the insurance industry looks very positive, citing the increasing range of insurance products.

He hinted that a weather indexed agricultural insurance had been introduced in the country with support from the German Development Cooperation and other stakeholders.

“The availability of insurance protection for the agricultural sector will ensure compensation to farmers when they suffer losses resulting from unfavouable weather and other disasters.”

The president called on operators in the industry to take advantage of the available technology and deploy robust Information Technology (IT) to improve the efficiency and effectiveness of service delivery.

He also expressed the hope that deliberations at the conference would provide a new direction and influence the socio-economic development of the country.