Chuks Udo Okonta
The much awaited no
premium no cover is expected to kick- starts in the Ghanaian insurance industry
today.
The nation’s Commissioner
for Insurance, Lydia Bawa, who disclosed this last year, in an interview with
Inspenonline, said the
initiative would help curb the menace of granting insurance cover on credit.
She noted that the menace has stemmed the growth of the industry as most
operators find it difficult to pay claims due to lack of fund.
She said: “The Problem we
have in Ghana is about payment of claims. Insurance companies are not paying
claims, and that is giving us a bad name.
The insurers are not paying claims because they are underwriting on
credit. So, they are not able to generate enough premiums, invest and make
claims.
“I have learnt from the
Nigerian Insurance Industry experience.
From discussion with Nigerian Insurance Commissioner, Fola Daniel, I got
to know that he introduced no premium no cover, to halt the sales of insurance
on credit and its is working well for the industry.
“With the policy,
premiums are paid up front, underwriters collect their premiums, invest and pay
claims and everybody is happy. So, I have decided to implement this effect from
January 2, 2014. I have government’s support to go ahead with it. At this
stage, I have writing to the industry players, for their comments, and after
that, I would go ahead with the policy.
“I believe it would
restore the confidence that is already lost by policyholders and the general public.
This is one major project I have taken as the new Commissioner. “
She noted that having
been an underwriter for 31 years, in the Ghanaian insurance industry, she is
abreast of all the issues in the sector and pledged to reform the industry.
She said perception and
mistrust has been the bane of the industry, adding that most people believe
insurers take premium and do not pay claims; hence, they do not really trust
insurance.
She called on insurers
across Africa to intensify awareness about insurance, adding that the apathy on
insurance can be change through proactive awareness creation.
She said the insurance
penetration in Ghana is about 1.5 per cent, stressing that the country is
working towards introduction of Takaful.
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