Upon introduction of a new digital platform to check vehicle insurance registration at the Driver and Vehicle Licensing Authority (DVLA), the motor vehicle insurance subsector of the insurance industry is set to realise an increase in the uptake of insurance in the country, Head of Supervision at the National Insurance Commission (NIC) Mr Seth Eshun has said.
Under this project, government is expected to launch a digital platform that will link the data of insurance companies to the DVLA to check vehicles that have been insured in real time.
In an interview at the end of Donewell Insurance Company’s 25th Anniversary Symposium, Eshun said, “we have about 40 percent of the total vehicle population that are not insured or have fake insurance credentials.”
Although the country has about 5.3 million cars that have been registered by the DVLA, data from NIC shows that, road-worthy cars are about 1.5 million while those insured are about one million.
For this reason, Eshun noted, the NIC is working together with the DVLA to ensure that cars that are not registered are not issued with roadworthy licenses unless they have been insured.
It is believed this system will deepen insurance penetration and create a pool of fund which can be used for investment.
Measured as a percentage of GDP, insurance penetration remains below two percent of the population, which underpins the vast but yet to be exploited potential.
Eshun noted that the platform is expected to be floated by the end of the year and will form part of the motor insurance database the regulator is compiling.
“That is one of our key priorities for this year,” he said.
Motor insurance is the biggest segment of the non-life insurance industry, accounting for GHS360 million (US$135.3m) which translates into 42% of the total premium insurance raked in 2015.
The new digital platform will provide the Ghana Revenue Authority (GRA) and the Police Service with reliable data to know which vehicles have been insured through an electronic process.