Insurers urged to develop innovative products

Mr Seth Terkper, the Minister of Finance, has urged insurance companies to develop innovative products and services in both general and life insurance to promote the country’s transformational agenda.

He urged the companies to be innovative in the area of health insurance, micro-insurance, agricultural insurance and other such products that could lift the people out of poverty and promote small and medium enterprises development.

The Minister said this at the launch of the 2015 Insurance awareness Month Celebration in Accra on the theme: “Insurance and You, Get Insured.”

He noted that a robust insurance industry would promote reliable alternative sources of funds for SMEs by providing access to credit at competitive rates since insurance is an essential element in the operation of national development.

He expressed government’s commitment to sustain and accelerate progress in the financial sector by pursuing policy initiatives.

Mr Terkper said the insurance penetration level in the country is below two per cent and expressed the hope that insurance companies would not only help in addressing the challenges but also promote the benefits of insurance to the public.

He said insurance industry must complement government’s efforts to ensure that majority of the population become financially literate to enhance their financial capability and ward off the deceptive offers from predator financial service providers.

“Financial literacy has been identified globally as a critical tool for development, issues relating to budgeting, savings, investment and the management of risks are relevant for the individual, households and businesses in their development process,” he added.

He said government recognises that financial exclusion reduces the potential welfare of individuals and the productivity of enterprises in the economy and as such have collaborated with the financial sector players and other key stakeholders to develop a national financial inclusion strategy.

Mr Terkper said the strategy when completed and implemented would improve access to affordable financing and deepen the country’s financial sector.

Ms Lydia Lariba Bawa, Commissioner of Insurance, said there are still people who insure their vehicles just and only because they do not want to be harassed by the Police.

She called for a consistent and concerted effort to raise insurance awareness to an appreciable level, adding that the integrity and reputation of the insurance industry of the insurance industry from the public is still very low.

Ms Bawa called on insurance companies to deliver on their promises and pay claims in the correct quantum and with the same enthusiasm as that with which premiums are collected.

Mr Ivan Avereyireh, President of Ghana Insurers Association said the total claims received by various insurance companies from their clients in regard to the June 3 disaster in respect of losses sustained are in excess of GH¢333.00 million.

He explained that most of the individuals who lost their lives and properties alongside some small and medium scale businesses operating in the informal sector did not receive any claim because they were not insured.

Mr Avereyireh said the industry would now focus on micro insurance because the products are simple and affordable, taking advantage of electronic platforms for distribution and payment of premiums.

“More importantly, requirements for claims processing and payment are simplified to meet the expectations and peculiar circumstances of the target group of low income earners,” he added.