The government has indicated that, it will soon roll out a policy that will ensure all state owned companies and assets are insured by local insurance companies in the country.
The move according to Senior Minister Yaw Osafo Maafo, is to reverse the low insurance penetration in the country.
Insurance in Ghana has for years, remained at just two percent despite numerous moves by insurance companies to increase penetration.
The low penetration of insurance in Ghana has left many companies unable to venture into capital intensive projects such as the oil and gas industry.
In an interview with Accra base radio, Senior Minister, Yaw Osafo Maafo said the policy when rolled out, will provide medium and long term funding for the insurance industry in the country.
“The government has a lot of assets such as the Akosombo dam, so if the government decides to take insurance cover for some of the major assets, it will increase the penetration of insurance business. Also, we need to create medium and long term sources of funding and this can also come from the insurance sector for the development of the country”.
He explained that the cost that government agencies will incur as a result of the insurance, is largely accountable for the non-insurance of government assets.
“All government vehicles are not insured as a policy because the frequency is such that the government is prepared to pay for insurance cover for the people in accident rather than insuring the vehicle; it’s a cost estimate. If I’m to insure fifty thousand vehicles and only two get involved in accidents, then it’s cheaper for me to pay after the accident than to do the insurance so it’s all about cost”.
Mr Osafo Marfo however assured that government he will push for a policy that will see to the insurance of all government assets.
“The government should take a policy to ensure all vehicles and that immediately will give a lot of business to insurance businesses and that will improve penetration”.
He made these comments on the sidelines of the 45th Insurance Conference and Annual General Assembly.
In a related development, Mr Osafo Marfo urged insurance companies on the African continent to pool their resources to undertake huge budget projects.
“I would think that if we are collaborating with Cote d’Ivoire, collaborating with Nigeria, and other countries within the sub region, our capacity will be bigger and we can take on bigger risks and that will retain our premium payment within the region”.
“Otherwise we have to get insurance from foreign countries and those countries are ready to get the business from us so we should do a lot of collaboration so we retain of the business within the region, this is very key”.