Business News of 2013-12-27

SIC defends contracts with government

State Insurance Company (SIC) has rejected arguments that if Ministries, Department and Agencies ((MDAs) insure with the company, it could lead to the collapse of the private sector insurance companies.

According to an article in the Daily Graphic by Management of SIC and Ghana-Re, the company maintained that the directive for MDAs to insure with SIC on the contrary, gives these agencies an opportunity to insure elsewhere if they wish.

President John Mahama last week directed all MDAs to insure with insurance companies that are wholly or partly owned by the state.

According to a notice cited by JOYBUSINESS and signed by the Executive Secretary to the president, Dr. Raymond Atuguba, the directive is for MDAs that are taking insurance cover for government businesses.

But in the article, the award-winning company maintained it was unfortunate the reactions that have greeted the directive especially from the Ghana Insurers Association.

SIC is worried that the Association, which is supposed to protect the interest of all its members, appears just to be protecting a few and treating other members like "aliens".

SIC argues that it is not the premiums of the MDAs that would grow or collapse the private insurance companies, but the ability of these firms to come out with innovative products and offer outstanding service delivery to the insuring public.

SIC therefore, described as a charade, assertions that all the private insurance companies would collapse, if they do not insure government businesses.

The state insurer believes that real beneficiaries of the directive are the 48,000 shareholders of the company, rather than arguments that it would only benefit one company.