The Shipping Community has been sensitized on the benefits of insuring their Cargo locally as part of the Government’s efforts to ensure that Ghanaian Shippers are protected in their international trade transactions.
The current efforts by the Ghana Shippers Authority and its partners: the National Insurance Commission (NIC) and the Ghana Revenue Authority (GRA) would help reduce the risk to Shippers when they suffer loss or damage in the Shipment of their cargoes, by placing their Cargo insurance locally which is a requirement of the National Insurance Act, 2006, Act 724.
Mr. Charles Sey, Manager for Western and Central Regions of the Ghana Shippers Authority, reiterated the commitment of the Authority to ensure that Shippers in Ghana were protected under the laws of Ghana to undertake their trade activities during the Central Regional Shipper committee meeting held in Cape Coast and Organized by the Ghana Shippers Authority.
The Senior Freight and Logistics Officer at the Ghana Shippers Authority, Mr. Abdul Haki Bashiru-Dine, noted the importance of insuring cargo locally under the recently signed cargo insurance protocol by industry stakeholders.
He noted that only 6 per cent of Ghana’s international trade of over 76 billion cedis in 2019, was insured locally.
The expectation is that the figure will further reduce to 4.5 per cent based on provisional figures for 2020, he pointed out.
This situation, he said was not the best giving that, shippers are too exposed to the international insurance market which did not necessarily promote their interest.
It also has implications for the cedi stability and foreign exchange market and consequently a negative impact on shippers in terms of their trade cost which was already high.
He said other benefits to shippers include the ability to choose an insurer, payment of relatively cheaper premiums, quick and easy processing of claims when Shippers suffer losses, strong regulatory oversight by NIC and Ghana Shippers Authority to ensure the right insurance policies are applied for various types of shipments.
According to him, a well regulated and supervised insurance market also benefit shippers in terms of placement of cargo insurance providing protection and facilitation of international trade for Shippers in Ghana.
Additionally, the GRA would be able to rely on insurance values and consequently, shippers would be competitive in their duty payments.
He noted that the non-compliance by shippers of the Insurance Act 2006, Act 724, exposes them to foreign underwriters which creates challenges for shippers when they suffered loss or damage to goods.
He said it was, as a result, the cargo insurance protocols were developed through a collaboration between the NIC, the GRA, and the Ghana Shippers Authority with Technical support from the Institute of Chartered Shipbrokers, GRA, to ensure compliance with the Insurance Act while at the same time protect shippers in Ghana.
He explained that as part of steps towards implementation of the protocols, sensitization exercises have been lined up across the various shipper committees of the Ghana Shippers Authority in the Country and other key stakeholders in the shipping industry.
Mr. Kofi Andoh, Deputy Commissioner of the National Insurance Commission assured importers and exporters of the Commission’s commitment to ensure that all consumers of insurance get value for money.
He mentioned that the local insurance market was adequately regulated to provide full protection for the Assured.
He said the Commission had also published guidelines to bring transparency to the claims process when an insurer suffered loss or damage.
Mrs Mercy Boampong, Assistant General Manager of Enterprise Group assured importers and exporters in Ghana of adequate capacity of the insurance market to meet the demands of the shipping public.
She noted that Cost Insurance Freight covering imports only provided a minimum of clause C under the international Institute Cargo Clauses covering only minimum cover and does not usually protect the importer’s needs.
She noted that the advantage of taking the insurance locally was that, it will significantly offer protection for shippers because there will be certainty in the risk that is being covered.
Mrs. Boampong noted that the rate of insurance premiums for marine is usually between 0.25 per cent and 1per cent of the value of the consignment.
Shippers were therefore encouraged to insure their Cargo locally for their benefit and in compliance with the National Insurance Act, 2006, ACT 724.