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State Insurance Company (SIC), has said government is partially responsible for the slow rate of insurance penetration in the country.
The State insurer explained that the current two percent insurance penetration rate, touted by the regulator, NIC, could be increased if government collaborates to insure its infrastructure, while fraud and fake sticker patrons are wiped out in the system.
Speaking to the Goldstreet Business exclusively, SIC’s MD, Mr. Stephen Oduro disclosed that almost all government infrastructure including all Ministerial buildings and the 216 MMDAs have no insurance cover.
“Not only infrastructure, almost all government vehicles including that of the Police remains uninsured. Replacement becomes difficult when victims get hit by such cars or through accidents. It’s been like that for so many years. Only a handful, VRA, BoG, GHAPOHA etc are insured” Mr. Oduro disclosed.
He explained that finding answers to the challenge could only be made possible if government makes the conscious effort to insure all public buildings, adding, “mortgage companies must also include insurance as a requirement when selling their properties,”
Sub-Sahara Africa with an estimated population of one billion has a 2.3 percent insurance penetration rate.
Nigeria, with a population of 196 million, has 2. 1 percent of the continent’s total, which means Ghana with an estimated population of 30 million is relatively doing well controlling two percent of the total.
South Africa, the leader by far, controls the continent’s insurance market space with 14.7 percent share.
However, Mr. Oduro maintained that Ghana’s insurance market is very fertile.
The law requires that every commercial building including all petrol stations be covered with fire insurance, but Mr. Oduro said: “about 90 percent of fuel stations don’t have that insurance package. We go there to source for the business and the response is usually, “sales are not that great, give us sometime”.
He cited the old Foreign Affairs Ministry which was razed down by fire in 2009 as an example of one of the public infrastructure which would have been rebuilt through insurance, if it were to have an insurance cover.
Ghana can perform appreciably well, in the sub region’s insurance sector and increase penetration rate significantly from the current two percent, if efforts are made to capture all public and private infrastructure into the country’s insurance space.
Source: Wisdom Jonny-Nuekpe || Gold Street Business