The President of Ghana Union of Traders Association (GUTA) is calling on the government to urgently suspend the implementation of the Insurance Act 2021 due to some clauses the association finds problematic.

President of GUTA, Dr Joseph Obeng, in a press statement noted that the new law requires traders to compulsorily register with a particular insurance company of choice in Ghana even when there are better alternatives out there. He further opined that the new law was not well thought out.

“It is a law that mandates me to compulsorily take an insurance company when the service is not being bettered, when I can have better service out there, when I have my suppliers who owe my goods also opting for their preferred insurance companies and all that, I don’t think they’ve taken their time to dissect the issues.”
GUTA Prez

The President further stressed that the new law must be given a second look to protect the interest of importers.

“They have to look at it again, withdraw it, consult the stakeholders, convince us why probably we can even give some power to such law or act otherwise they cannot impose this. I see this as an imposition.”
GUTA Prez

Meanwhile, per the law, importers are to insure their goods only with local insurance companies.

Moreover, the law also prescribes a jail sentence for importers who do not comply with the mandatory Marine Insurance Policy.

However, GUTA believes the sanctions are extremely harsh and impractical especially under their current mode of operations where their suppliers pay for the insurance of goods overseas due to their agreed credit arrangements.

Meanwhile, in a response by the National Insurance Commission (NIC), it has assured all stakeholders that it will continue engaging stakeholders on the implementation of the Insurance Act 2021.

After concerns raised by importers, the NIC, in a statement, said it was only “enforcing an existing law that dates back to the Insurance Law of 1989, PNDC Law 227.”

“For effective administration, the new law requires that the NIC designs regulations as a guide for implementation. This process has since commenced and will involve various stakeholder engagements”.
NIC

The new Insurance Act 2021, which received presidential assent in February 2021, replaced the Insurance Act of 2006. It made it mandatory for all goods being imported into Ghana, to be insured in the country by insurance companies licensed to operate in Ghana.

It seeks to drive the growth of the domestic insurance industry by mandating the purchase of certain types of insurance as well as by strengthening internal governance requirements and the supervisory framework for insurers.

However, the Importers and Exporters Association had also earlier raised concerns about the custodial sentencing clause in the Ghana Insurance Act 2021. They called for a review of that portion of the law adding that it was imperative to preserve the sector.

The Executive Secretary of the Importers and Exporters Association of Ghana, Samson Asaki Awingobit, also called for a review of the law which “we believe does not represent the vision of the current government to create an enabling environment for the trading sector.”