The National Insurance Commission (NIC) has increased the minimum capital requirement of insurance companies by over 300 percent.
A statement issued to that effect indicated that the increment was agreed on after a series of consultations with stakeholders since 2017.
The statement also revealed it also considered the developments within the financial landscape over the period.
Life and Non-life insurance companies, had their minimum capital requirement increased from GH¢15 million to GH¢ 50 million.
For reinsurance companies, the minimum capital requirement has been increased from GH¢ 40 million to GH¢125million.
For insurance broking companies and loss adjusters, the minimum capital requirement has been increased from GH¢300 million to GH¢500 million.
The minimum capital requirement for reinsurance broking companies was maintained at GH¢ 1 million.
The deadline for these companies to raise the amount and meet the requirement is June 30, 2021.
According to the Insurance Commission, affected institutions are expected to submit their initial recapitalization plan by August 31, 2019, but “injection of the property will not be accepted.”
“Any unencumbered property that is introduced will have to be sold for cash by at least six months before the capitalization date,” the Commission said.
It further gave the assurance that it was working to protect the interest of insurance policyholders and also ensuring a strong industry.
It added: “the new MCR [Minimum Capital Requirement] is one of the initiatives the Commission is taking to achieve this.”
“The Commission will work with all industry players and provide the needed assistance to help the industry meet the new MCR,” the statement said.