Ghana, being a regional leader in micro-insurance has given indications that the National Insurance Commission (NIC), will be targeting insurance for small business holdings to get insurance for their outfits. This was announced by the Head of Supervision at the commission, Mr. Seth Eshun.
Speaking at the end of Donewell Insurance Company’s anniversary symposium he said, “we have been concentrating a lot on the individual person, but now we want to look at insurance not just for individuals but also for small business holdings. That would be the next phase that we will be taking micro-insurance to.”
The 2017 edition of the Oxford Business Group Report estimated that the value of Ghana’s insurance market will hit US$600 million this year rising from US$400million in 2014, based on a projected annual growth rate of 8.5 percent
Measured as a percentage of GDP, insurance penetration remains below two percent of the population, which underpins the vast but yet to be exploited potential.
Currently micro-insurance covers about 7.5 to eight million resident Ghanaians with most of them enrolled on the insurance platform through the use of mobile technology, Eshun noted.
According to a study by the NIC and the German development agency GIZ, a large proportion of premiums for this market are sold through mobile phone operators, with a combined 2.7m policyholders registered on the three major networks by June 2015.
These products are mostly sold through rural banks and government outreach programmes.
“So we have some very good traction through micro-insurance, and we want to continue doing that, to make it easier to get micro-insurance out there.”
Although mobile insurance is the primary distribution channel for micro-insurance, there is evidence that the growth of this product line has spurred consumer education more generally, as well as boosted sales of micro-insurance through other channels.
Technology, which allows for unlimited reach, including to low income earners, is believed to be the catalyst for the sector to reach its touted potential in the coming years.
In Ghana, micro-insurance has experienced a steady growth over the past years, as it continues to serve as an important mechanism for managing uncertainties and vulnerabilities of low-income segments of the population.
The 2012 micro-insurance landscape survey conducted revealed that 1.8 million representing seven percent of the Ghanaian population of 25.4million as at that year had some form of microinsurance coverage. In 2013, this figure increased to 3.1million representing 12 percent of the population in 2013 and 28 percent for the year 2014.
By Joshua W. Amlanu