What are your priorities as the commissioner of the NIC?
The first priority is to get the commission to be more proactive. We want to protect the interests of policyholders and ensure we have a level playing field for all industry players. We also want to help build insurance penetration, because it is currently below 2%. There is a great deal of leakage in our system. For example, only 36% of Ghanaians have some form of insurance, while 30% of vehicles on the roads are not insured. We also look to promote microinsurance as the majority of people belong to the low-income sector and agro-insurance as the majority of Ghanaians are in that sector. We want to speak with the government on many issues. First, it should purchase some percentage of insurance to boost the penetration level. Second, we want to convince it to make work-compensation insurance available for a set group of people. We also want to provide life insurance for a particular class of workers, with an eye on unemployment insurance. Finally, we want to create associations with certain levels of autonomy to deal with some issues to remove some of the burden on NIC.
What products does Ghana's insurance industry need?
We lack levels of research, which is something we want to spearhead. We want to truly understand why people do not buy insurance products. One of the challenges is that its products are solely created from the head office. They then go to rural areas and tell them about their offerings; it should be the other way around. We need feedback from those people in the countryside before we design and try to market a product.
What is your vision for the development of microinsurance in Ghana?
A large part of the population is from the low-income sector, which is the target for microinsurance products. The challenges include education, accessibility, and managing the product, including how to sell the product, how to collect premiums, and how to settle claims. With microinsurance, there are small premiums so a company has to find an effective way of doing it to become a lucrative business. The best way to drive and improve microinsurance in our market is to, in fact, use technology.
What prospects do you see with the international standardization of regulations within re-insurance?
In our market, before we send any business out, we have to be sure that the local capacity is taken care of. Because we have this requirement, it slows down the arrangements. If it takes a long time to complete re-insurance arrangements, anything could happen. I want to sit down with the industry and come up with a prudent way to tackle this. The best approach is to have a formula.
Where do you see the major opportunities for Ghana's life and non-life insurance market?
When it comes to life education and confidence in insurance, it has to come from the regulator. Everyone should want to buy a life insurance plan, and it should be something that will be easy to sell since everyone will die. People do not have trust in insurance because they think insurance companies are quick to collect premiums, but slow to pay claims. We look to have a toll-free number at the commission where people can call in, and we will address their issues and direct them to the appropriate areas. If we are able to convince banks to have life insurance policies for every person who comes in for a loan, that alone is a big business. That way at least when there is a loss, we will pay their starting balances. It is all about innovation. We need to look into designing products that are affordable, especially with microinsurance; at the same time I want an insurance industry that can also assist society. Clients have to be confident in a system that works.