NIC suspends 10% motor insurance premium increase

Ghana’s insurance regulator, the National Insurance Commission (NIC) has suspended a proposed plan to implement a 10 per cent increase in motor insurance premiums which was to take effect today.

In 2024, the NIC announced its intention to implement a 10 per cent increase, revised from an initial 15 per cent, effective February 1, 2025.

The suspension of the implementation of the 10 per cent increase in premiums was contained in a letter dated January 29, 2025, signed by the acting Commissioner of the NIC, Michael K. Andoh, who explained that the new motor tariff has been suspended due to unforeseen circumstances.

He consequently advised the Ghana Insurance Association and the Insurance Brokers Association to price their motor policies using the 2024 approved tariff.

Drivers kick against plan

The planned increase in motor insurance premiums has been met with widespread criticism from various stakeholders, including the Ghana Private Road Transport Union (GPRTU) and the Ghana Road Transport Coordinating Council (GRTCC).

The unions vowed to resist the implementation and threatened a nationwide strike and fare increment if the government did not reconsider its decision.

"We are calling on the government to reconsider the decision and engage us to find a solution that would be beneficial to all parties involved," he added.

They claimed that the increase would worsen the challenging times their businesses and livelihoods were suffering and also lead to a rise in transport fares, as it would ultimately be passed on to consumers.

Appeal to President

The Member of Parliament for the Abuakwa South Constituency in the Eastern Region, Dr Kingsley Agyeman, also adding his voice to the call to suspend the rollout, urged President John Dramani Mahama to intervene and prevent the NIC from implementing the proposed increment.

He stressed that any increment at this time would negatively impact the insurance industry and the motoring public.

“I appeal to His Excellency, President John Dramani Mahama, to listen. He must instruct the NIC to halt this increase so that further consultations can take place.

Otherwise, it will cause untold hardship for the average Ghanaian.

"A 10 per cent increase in compulsory motor insurance is no small matter.

The ripple effect will hit the Ghanaian people the hardest.”

Dr Agyeman also criticised the lack of sufficient consultation with stakeholders, claiming that the decision may exacerbate existing challenges in the insurance sector.

“As an industry player, I expected more consultation to assess the potential impact of this increment on general conditions of service,” he said.