All international travelers arriving the Kotoka International Airport will be mandated to roll-on to a compulsory insurance cover known as the ‘Akwaaba’ insurance policy by the end of first quarter of 2022, .
The Managing Director of SIC Insurance PLC, Stephen Oduro disclosed to the B&FT that a consortium of three Ghanaian insurance companies – State Insurance Company PLC (SIC), Enterprise Insurance and GLICO Insurance Company – will oversee implementation of the policy.
“Per provisions of the policy, every traveler coming into the country will be required to purchase the insurance regardless of the duration of stay and nationality,” he indicated.
The Interior Ministry is accordingly expected to urgently ratify the proposal to ensure it becomes operational even before the end of the first quarter.
Mr. Oduro, who made these remarks in regard to expanding the country’s insurance penetration, said there are many other initiatives in the offing to increase Ghana’s insurance coverage.
The current national insurance penetration level is still below two percent, with the penetration rate in the whole of sub-Saharan Africa not reaching up to 20 percent. However, the situation in Ghana is expected to improve in the near-future, as steps have been taken for SIC to provide insurance to all tertiary students in the country, as well as fire insurance for all hotels in the country.
“We have had negotiations; we signed every agreement with the National Union of Ghana Students on the provision of insurance to all tertiary students in the country, and that will soon be executed. These are some of the solid measures to increase the penetration rate,” Mr. Oduro noted.
The insurance industry in Ghana has numerous reasons for optimism. Coupled with an emerging middle-class that is helping to boost the sector’s assets, the insurance regulator – the National Insurance Commission (NIC) – has in the past expressed its determination to capitalise on this latent market potential; targeting a penetration rate of 10 percent by the end of 2021.
Though the NIC hoped to leverage the growth of new business lines such as bancassurance, micro-insurance and mobile insurance to bring this target into reach, the penetration rate beginning this 2022 remains static at below two percent – and has been lingering after the 2021 target elapsed.
With the regulator also bearing down on underwriting policies, Ghana’s insurers are faced with the difficult task of significantly boosting efficiency and bolstering their bottom-line over the coming years – a situation that is already triggering calls for mergers in the insurance sector.
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