NIC urged to strictly enforce insurance regulations

The Managing Director (MD) of the Risk Management and Advisory Services, Mr Larry Kwesi Jiagge, has asked the National Insurance Commission (NIC) to be stringent in the application of regulatory measures in the insurance industry in Ghana.

For instance, he said the NIC should be tough to delist companies that could not meet the minimum capital requirements within a stipulated period.

Addressing the 25th anniversary symposium of Donewell Insurance Company Limited on July 12, 2018 in Accra, Mr Jiagge said the commission should ensure that the insurance companies were solvent and liquid enough to handle big ticket projects in the country.

“The regulator must ensure stringent application of regulatory measures on premium competition; also it should ensure the delisting of companies that could not meet minimum capital requirements,” he said.

He noted that an enhancement of capital with a minimum of the equivalence of US$10million from the current US$3.5million for the insurance industry to remain liquid and solvent despite challenges.

Mentioning some challenges in the industry, Mr Jiagge observed that the industry was suffering from low level of capitalisation.

“The industry is suffering from small and poorly managed entities. Another setback is the unbridled and unsustainable competitive regime of what he described as a machiavellian nature of the industry,” he added.

To address the challenge, the MD explained that a significant step was the recognition by the market that there was something amiss and must be addressed.

“The recommendations to tackle the problems should be a market wide strategy involving all sectors and should also include a collaboration between the regulator and industry persons,” he said.

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The symposium

Speaking on the theme: Insurance in Ghana-The Different Perspectives: the Regulator, the Investor, the Insurer,” the Insurance Commission, Mr Justice Yaw Ofori said the symposium had been held at an opportune time.

“I say this because the investor, and the insurer are key component of making the insurance viable. The regulator governs, regulates, and protect the interests of the public.

The investor commit money to an entity and expects financial returns or profit, the insurer contract and promises to pay its customers in event of a lost,” he added.

Growth in the insurance industry

For his part, the Chief Executive Officer (CEO) of Donewell Insurance, Mr Seth Aklasi, indicated that his outfit had played a major role in the growth of the insurance industry.

“Donewell Insurance had supported Ghana’s economy over the years and as you all know, the company is 25years in this business and we are celebrating it in grand style throughout the year.”

He recalled that activities for the 25th anniversary celebrations began with a press launch in April which was followed by a blood donation exercise.

“The blood donation exercise, which was done in collaboration with Happy FM – a subsidiary of the Global Media Alliance Group, is one of the many CSR activities lined up for the year.

For us at Donewell, attaining 25 years would have been meaningless without a concrete foundation,” he said.

According to him, the foundation upon which the company thrives was the industry and as such we deemed it necessary to bring all those who matter within this industry to discuss the very issues that faced our business.  

He indicated that technology was changing business strategies and transactions in all sectors and industries.

“You either evolve or you go extinct. The insurance industry cannot be immune to this wave of change and it is, therefore, critical that as practitioners and leaders, we take note and plan accordingly.”