National Insurance Commission Grants Sandbox Licenses to Five Insurtech Firms

The National Insurance Commission (NIC) of Ghana has issued sandbox innovation licenses to five Insurtech firms, allowing them to pilot innovative insurance products for one year. The move marks a significant push towards harnessing technology to boost insurance penetration in the country, as the NIC looks to modernize the sector through digital transformation.

The licensed Insurtechs will operate within a regulatory framework designed to encourage innovation, with their performance subject to review after the pilot phase. This could potentially lead to the issuance of full licenses, contingent on the success of the products.

Insurtech Driving Sector Growth

At the Tech and Innovation Insurance Forum, Michael Kofi Andoh, the acting Commissioner of Insurance, emphasized the necessity for innovation to drive growth in the sector. He pointed to the adoption of emerging technologies such as artificial intelligence, machine learning, and blockchain as critical to expanding access to insurance and closing the protection gap.

“As a forward-thinking regulator, the NIC is committed to enabling market players to leverage technology for development,” Andoh said. He added that the country’s modern Insurance Act offers a supportive environment for such innovations, positioning the sector to expand its reach significantly.

FSD Africa Backs Ghana’s Insurtech Ambitions

The regulatory sandbox initiative has been supported by FSD Africa’s Bimalab programme, which aims to foster innovation in the insurance industry across Africa. Since its inception, the programme has helped establish more than 100 Insurtechs, raised $35 million in capital, and launched 75 new projects in 16 African countries.

Elias Omondi, Principal for Innovation at FSD Africa, praised the NIC’s proactive stance in promoting Insurtech, noting that innovation is key to addressing the low insurance coverage and high costs that have historically limited access across Africa. “A supportive regulatory regime is essential for enabling these technologies to flourish,” Omondi said.

Expanding Insurance Coverage in Ghana

Among the five Insurtechs granted sandbox licenses are Figtech, Moovon Insure, Hollard Insurance, ETAP, and Trade Guarantee Limited (TGL). Each firm will roll out products aimed at increasing coverage, particularly in underserved segments of the market.

Ghana’s insurance sector, which consists of 26 non-life companies, 18 life insurers, and 3 re-insurers, has seen steady growth, with total assets reaching GH¢17 billion by the end of 2023. The NIC’s embrace of digital innovation is expected to further expand the sector and deepen market penetration, addressing challenges such as low insurance uptake and improving financial resilience across the country.

Source:norvanreports.com