Dr Justice Yaw Ofori, NIC Commissioner
*January 2022 deadline set for insurance companies recapitalization
*Insurance penetration in Ghana remains at 2 percent
*NIC extended deadline from June 2021 by six months due to COVID-19
The National Insurance Commission has cautioned insurance companies that fail to meet the January 2022 recapitalization deadline with sanctions.
According to Commissioner of Insurance, Dr Justice Yaw Ofori, companies that fail to heed the recapitalization deadline will no longer be able to make advertisements or renewal insurance policies.
In an interaction with Citi Business News, the NIC boss said although some insurance companies have been able to meet their respective minimum capital requirements, there still remained few yet to meet the deadline.
“Some of them have met the deadline, others have also during the holidays recapitalized so we are going through all that documentation so we can give a clear figure of how many of them have done it so far.”
“…When we view your documents and we realize that you are not actually meeting the required minimum capital, then we will write to you and tell you that this is the shortfall so find resources to actually meet the deadline. If you are unable to achieve it by the deadline then that is when the enforcement action kicks in and we stop you from doing new business, stop you from renewing policies, stop you from advertising yourself and then we find a manager who will take over the company,” Dr. Justice Ofori explained.
Meanwhile, the NIC in June 2019 issued a directive to insurance companies operating in the country to meet a minimum capital requirement as part of efforts to increase insurance penetration and sanitize the sector.
The requirement meant that these entities and their respective categories were to pay million of cedis as regulatory capital.
For Life and Non-Life insurance companies in Ghana, the regulator increased the requirement from GH¢15 million to GH¢50 million.
For Re-Insurance firms, the NIC raised the minimum capital requirement from GH¢40 million to GH¢125 million while that of insurance brokers was increased from GH¢300,000 to GH¢500,000.
For reinsurance brokers, the NIC maintained the minimum capital requirement of GH¢1 million.
Over the years, Ghana’s insurance penetration has remained rather low with a reported rate of 2 percent.
The insurance sector for any economy remains critical for growth safeguarding of lives and property.
Source: www.ghanaweb.com
