Business News of 2014-07-09

National Insurance Commission to apply sanctions

The National Insurance Commission (NIC) would penalize any foreign reinsurance company which flouts the rules and regulations governing their operations in Ghana.
Mr Simon Nerro K. Davor, Deputy Commissioner, who announced this at an Engineering Training Seminar for the Ghanaian Insurance Market in Accra, therefore, advised the companies to abide by the laws to help build the local industry.
The four-day seminar is being sponsored by Nouvelle Campagnie Africaine de Reassurance (NCA Re), a foreign Reinsurance Company, in collaboration with the Ghana Insurance Association (GIA) for senior staff members. Mr Davor said the law required any foreign insurance company which wanted to operate in the country to establish a local office but some of these companies were operating without a local office.
He said the NIC was also unhappy with the manner in which some companies transferred their premiums abroad without the approval of the Commission. The foreign companies are mandated to pay some commission on their premium to the NIC and receive approval from the Commission before it can transfer their premiums abroad.
The Deputy Commissioner said Reinsurance as an international business could conduct their businesses without locating in Ghana but as soon as they engaged a local contact person, they were required to establish a contact office as well. He commended the NCA Re for organising the seminar for participants free of charge and urged participants to take advantage of the opportunity to equip themselves as well as improving their respective companies.
Mr Davor noted that the training would solve skills problems associated with the industry, saying improving their skills to underwrite correctly and their capability to pay claims as early as possible would improve their operations. He said educating personnel that prompted payment of claims was very important to re-gain public trust in the industry must be priortised.
Mr Ivan A. Avereyireh, Managing Director of Ghana Life Insurance Company, and the President of GIA, said they were serious on the training and re-training of staff and agents to ensure that customer service was perfected. He said the penetration rate of the industry now stood between 1.5 per cent and two per cent and the current board was determined to increase the rate.
Mr Avereyireh said they were undertaking a database project with support from the GIZ to make it easier for individual companies to access a common data pool. He said the government should encourage group life insurance so that if workers die naturally some money could be paid to their beneficiaries.
Additionally, he said, some strategic government properties also must be insured to lessen the burden on the consolidated fund in times of loss. He cited the old Ministry of Foreign Affairs building which got burnt some years ago, saying, “ïf that building had been insured, government would not have taken a loan to build a new office block for the ministry”. He also stressed the need to review the workman compensation law to sanction employers who did not pay that compensation.
Source: GNA
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