The National Insurance Commission (NIC) has disclosed that about 98% of insurance companies have met the new minimum capital requirement of the National Insurance Commission set out for insurance companies seeking to operate in Ghana.
Moses Ackah-Jayne, the Head of Marketing and External Relations at NIC, indicated that almost all of the insurance companies have met the required capital and those which didn’t meet are doing their best to meet it.
“All the companies that are currently operating have met the minimum capital requirements. There are a few discussing other details, about 98 percent largely have all met the minimum capital.”Moses Ackah-Jayne
Ackah-Jayne made this known on the side-lines of a four days Micro and Small Business Clinics (MSBC) for artisan leadership, small and medium enterprises (SME) and traders from several markets within Ashanti Region, organised by the National Insurance Commission in partnership with GIZ, Sanlam Insurance and Activa Insurance Company Limited.
Ackah-Jayne highlighted the need for the NIC to embark on the micro and small business clinic, noting that it would help erode the negative perception about the insurance industry. He added that it also afforded the participants a better understanding of the work of insurers and how important it is for them to purchase insurance products and services.
“You would appreciate the fact that the key employers in the country’s economy are the medium and small-scale enterprises. Unfortunately, because of lack of awareness and negative perception about insurance, they have been sidelined and have not been enrolled into the formal systems. Meanwhile they command a very large chunk of the economy and the most vulnerable.
“This programme is to reach out to these people to sensitise them on what insurance is all about and to help them appreciate the fact that insurance would help them to secure the future of their business.”Moses Ackah-Jayne
NIC Putting in Measures
Additionally, MAckah-Jayne noted that the NIC is putting in measures to ensure that insurance companies in the country also adhere to the tenets of the sector in a bid to redeem the image of the industry.
The participants were, however, encouraged to report any wrongdoing by insurance companies to the Complaints and Settlement unit at NIC for redress.
The regulator in June 2019 announced new minimum capital requirements for players in the insurance space. It increased the minimum capital requirement for life and non-life companies from GHC15 million to GHC50 million, while that of reinsurance companies was raised from GHC40 million to GHC125 million.
Insurance brokers also had their minimum capital increased from GHC300,000 to GHC500,000 while that of reinsurance brokers remained at GHC1 million.
All companies in the sector were to have complied with the new minimum capital requirements within two years by June 2021. However, the regulator extended the deadline by six months because of the COVID-19 pandemic.
A year after the deadline extension, it is now emerging that a significant of insurance firms in the industry have complied to the directive.