Gov’t to turn attention to insurance sector after banking reforms

The Senior Minister, Yaw Osafo Marfo, says government will soon sanitise the insurance industry. Speaking at the annual conference of the Ghana Insurance Brokers Association in Kumasi, Mr Osafo Marfo urged insurance companies to consider merging as a way of increasing their financial muscle to better serve their clients. “As government we are taking tough decisions to sanitize the banking sector. We will soon sanitize the insurance sector also because the two move together.” President of the Ghana Insurance Brokers Association (GIBA), Lena Adu-Kofi, tasked members to address their capital inadequacies to avoid unfavourable outcomes. She appealed to regulators to assist the market with policy framework that will optimize potentials in the insurance market. “Having embraced the need to increase the Minimum Capital Requirement, we as market players should be looking at the way forward. “This is because, adequate capital cam serve as a solid foundation to induce growth in our companies and our industry at large.” Commissioner of Insurance Justice Yaw Ofori explained the need for an upward adjustment of the minimum capital requirements of insurance companies. “An upward revision of Minimum Capital Requirement (MCR) is expected to help improve effectiveness and increase underwriting and retention capacity of our market. “Increasing the MCR is only one of a number of steps needed to strengthen the insurance industry. Other steps include enforcing current compulsory insurances to improve penetration, implementing risk-based supervision and solvency requirements, and improving the claims payment to improve public trust in insurance.” GIBA is in support of the proposed Minimum Capital Requirements of GH¢500,000. The Association is however entreating those who cannot meet the recapitalization to consider mergers. By Ibrahim Abubakar|editors.3news.com|Ghana