Currently, the sector’s contribution to the Gross Domestic Product(GDP) of the country is estimated below 1.5 percent.
Countries such as Nigeria and Kenya are said to have insurance penetration of about 3.0 percent,—more than half that of Ghana’s.
One major challenge facing the industry is lack of understanding of insurance policies and clarity on what some Ghanaians have described as hidden conditions.
According to the National Insurance Commission (NIC) the perception of hidden conditions is greatly hurting the reputation of insurance companies as they are perceived as cheats who conceal these conditions to forfeit payment of claims.
A victim who signed on to a life insurance policy after an insurance marketer convinced him told Citi Business News how he suffered wrongful deductions.
“The insurance marketer came to me and explained their terms of conditions but later on it turned out not to be so. I saw some wrongful deductions and I drew their attention to it,” the victim narrated.
The Commissioner of the NIC, Lydia Lariba Bawa told Citi Business News the commission is impressing on insurance companies to desist from the act.
“At the beginning let the client understand what he or she is buying before they sign the policy. Not when there is a claim we now tell them this is not covered, this is not covered. Let them understand and make a decision that yes, this is what I want, and at the time of claim make it simpler for them,” she stressed.
Recounting some complaints, Madam Bawa narrated how some companies have used such hidden conditions to decline payments to individuals who have signed on to policies.
She recommended that the way forward is for insurance companies to open up to explain all conditions.
“We have to treat our clients fairly, it shouldn’t be as if we are doing them a favour they are doing us a favour. So we must make a customer feel that he is the only customer you have by the way you treat the person.
She argued that even though insurance is major avenue for pooling funds for onward lending in the financial sector, Ghana is yet to fully benefit from it.
She stated that a good insurance industry helps channel fund in the financial sector to create liquidity for private investors to access.
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(Via: CitiFM Online Ghana)
