Insurers plan to own bank
A Bank exclusive for insurers is to be established in the country.
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The new President of the Ghana Insurers Association (GIA), Ms Aretha Duku, who announced this as she outlined her vision for the association did not, however, give timelines about when the project would commence.
According to her, insurers can own their own bank to help them with their businesses.
“The banks have been eating into our space and we can certainly give them a run for their money,” she stated.
Ms Duku said this at the investiture of the 10th president of the association. She is the first female president of the GIA.
She, however, noted that the issue about the establishement of the bank for the association would be tabled and discussed with her newly elected board and who would work towards it during her tenure.
Forensic laboratory
Ms Duku outlined plans to oversee the construction of the first forensic laboratory, which would enable the association to sieve legitimate claims off illegitimate ones.
"We are in the business to pay claims but not illegitimate claims as they create holes in our books," she noted.
She said the facility would, therefore, enhance their processes and help safeguard shareholders assets at the same time leaving the legitimate claimants with smiles.
She said her vision was to make the association a force to be reckoned with, adding that it could only do this by strengthening its resources and building its image.
Outgoing president's agenda
Ms Duku also gave the assurance that she would continue with some projects of the outgoing president such as the pricing regulations.
She said she would get the buy-in of all its members on pricing regulations as she believed this was the right way to go.
“This will help us achieve healthy growth and also translate into meeting our claims obligations and earn us the integrity of the public,” she mentioned.
Ms Duku also pointed out her willingness to continue the campaign of bringing insurance to the doors of everyone.
She, however, charged the members to bring the crusade of awareness to the forefront as they make insurance the preferred profession.
Insurance industry
The total gross premium as at December 2015 stood at about GH¢1.5 billion, an increase of about 25 per cent from the 2014 figure of GH¢1.2 billion.
About 55 per cent of it came from non-life insurance whiles the remaining 45 per cent was from life insurance.
Total assets also recorded a 36 per cent growth from GH¢2.2 billion in 2014 to GH¢3 billion in 2015.
The Commissioner of Insurance, Mrs Lydia Lariba Bawa, said about 50 per cent of these assets were in the form of term deposits with microfinance and other non-bank financial institutions some of which were financially distressed, leading to significant impairments in those assets.
She said this had impacted negatively on the solvency of the affected companies which were now required to inject additional capital.
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New capital requirements
Ms Bawa said during its recent assessment, majority of companies had met the requirements with eight companies yet to do so.
She said the NIC had met with these eight institutions to discuss their situations and asked them to submit action plans to meet the requirements.
She, however, pointed out should they still fail to meet it, the commission would be left with no other option than to withdraw their licences.
She said the NIC would take the appropriate action in due course to protect the interest of the policyholders of the affected companies.
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Calls for mergers
The Deputy Minister for Finance, Mrs Mona Quartey, called on the companies who were struggling to meet the new capital requirements of GH¢15 million to consider consolidation through mergers.
She said this would enable the country to have a more viable insurance industry as Nigeria did in 2004.
She also charged the new president to attach serious thought to higher ethical customer service standards.
She said improving the image and public confidence in the industry depended on how promptly and fairly it delivered on its promise to pay claims and how customer friendly its processes and procedures were to its customers.
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