Mr Larry K. Jiagge, Managing Director of Risk Management and Advisors has said only an estimated 30 percent of Ghanaians have an insurance cover due to the low penetration of insurance products and services.
He said Ghana’s insurance penetration is at 1.2 percent, which is same as the ratio of gross insurance premium to gross domestic product (GDP).
He cited inadequate use of technology, adverse selection, false claims, late payments of claims, depreciation of the cedi as the main factors militating against the prospects in the sector.
“It is worrying that rather than addressing the issues, more and more companies are being registered with shareholding structures that create an impression of investors on ego trips, rather than a commitment to developing a market structure with capacity to carry large, sophisticated and technical risk exposures,’’ he stressed.
According to him, the industry has a total of over 4,531 attached agents who are the second leg of the intermediary segment of the insurance market.
The number of people employed in the insurance industry is about 12,500 and made up of insurance agents, brokers, insurance and reinsurance staff.
Latest figures from the National Insurance Commission (NIC) indicates that the total assets of the insurance industry in 2017 is GHS5.4 billion made up of GHS2.9 billion in the life sector, GHS1.9 billion in the non-life sector and GHS0.6 billion in the reinsurance sector.
Mr. Jiagge speaking at the 25th anniversary symposium of the Donewell Insurance Company Limited asked parliament to quickly pass the new insurance bill into law as it will provide the needed legal backing to support the reform programmes the NIC is currently undertaking.
Some of these reforms, which are to be achieved in the next three years will include an insurance bill, a motor insurance database, well capitalized firms for minimum capital annuities and an orderly market to reduce undercutting and prompt claims payment.
The Chief Executive Officer of Donewell Insurance, Mr. Seth Aklasi on his part said the insurance industry cannot be immune to the blowing wind of change and it is therefore critical that practitioners must take note and plan accordingly.
By Mawuli Y. Ahorlumegah