The National Insurance Commission (NIC) says insurance policy holders risk losing their lump sums to insurance companies when they don?t read the policy regulation. The companies have been accused?of denying legitimate insurance?claims, creating suspicion among insurance holders. ?Insurance policy in Ghana is one product many people in the country are hesitant to take. Currently, there are 43 insurance companies in both the life and non-life insurance sectors, competing in a market where uptake of insurance is low, hovering around 1.5 per cent penetration of the estimated 26 million populations.
Over the years, efforts to increase the penetration rate have often not gone well. The regulator, National Insurance Commission (NIC) says is not ignorant to the public perception in the industry, and has initiated a number of policies and legislations to address challenges in the insurance industry to enhance public confidence. It is a known widely held view in the country that, prompt claims payment and premium debtors are some of the principal challenges that threaten the survival of the insurance sector. The NIC says it is concerned the outstanding premium profile could hurt the industry, necessitating the formulation and introduction of the ?No premium, no cover? policy to protect the interest of all stakeholders in the insurance industry – as the present practice exposes the industry to liquidity risks. So as the regulator strives to stabilise the financial standings of insurance companies and encourage people to recognise the importance of insurance in their lives. But for government, the time is ripe for Ghanaians to make hard choices and pay more for products that are even unpopular with them. For many people, insurance just offers one a piece of mind as claims payment challenges have left many in pain, affecting confidence and trust in insurance companies, Simon Davor said.
?Claims payment has been a major challenge in the Ghana insurance market. Insurance companies are in the business to pay claims and therefore companies should mobilise funds to pay claims even before they consider operational cost.?
Admitting that lack of education is the reason for the challenge, Deputy Commissioner of Insurance Simon Davor called on Ghanaians to read or seek explanations from their prospective insurance companies before signing onto a policy.
?The major problem we have in this country is reading the insurance policy to understand what in it before we sign up for a policy. Even we the somehow educated are guilty, therefore I will ask that before we sign up on any insurance policy we read into detail and ask all the relevant questions which will inform our decision before we sign up on the policy.?
Source: Norvan Acquah – Hayford