Insurance companies rid books of premium debts
Insurance business from January 1 this year, are supposed to keep no premium debts on their books, the National Insurance Commission (NIC), has said.
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This is because of a directive issued last January which required all insurance companies to write off any premium debts that will be on their books by the end of December 31 last year.
The Deputy Commissioner of Insurance, Mr S. N. K. Davor, who disclosed this in Accra expressed the hope that the measure would give significant reprieve to insurance operations in the country, while new companies which partner local companies will operate on a clean slate.
That problem has been cured. Based on that, the new policy of new premium cover should be embraced fully and not request for waivers. Abiding by it will make the benefits abide forever.
Mr Davor was speaking at the inauguration of the company’s new corporate address, Capital Place, located at East Airport, near Gold House in Accra. The occasion also saw the official announcement of a strategic partnership with Hollard Insurance of South Africa, which occurred through the latter’s acquisition of 51 per cent controlling stake in the local insurance company which started operations in 1994.
Capital Place, designed to international standards to deepen client and stakeholder confidence in MET Insurance, is owned by Mobus Property Holdings, which is owned by the Jonah family, Group Five and Metropolitan Insurance.
The Deputy Insurance Commissioner said the NIC – which regulates the insurance industry – was moving towards risk-based supervisory framework, which put emphasis on risk management control functions in insurance companies.
The new solvency framework also brings in its wake requirement for all insurance companies to establish compliance, internal audit, risk management and the actuarial controls and Mr Davor said Met Insurance had already instituted those measures ahead of the market and wanted the new owners to continue to blaze the trail.
He urged the new owners of the company to help design appropriate products for market women as the layout of markets had become a disincentive for insurance companies although the sector was profitable.
“With your experience, we want you to design appropriate products that our market women can take advantage of so that they will not be unemployed in the event of such fire outbreaks,” Mr Davor stated.
The Chief Executive Officer, Mr Kwame Gazo-Agbenyadzie, said MET continued to adjust and reinvent itself according to the complexities of the market and emerging risks of which the new corporate address and partnership, marking a new beginning for the insurance firm which was credited with pioneering some significant changes in the industry.
“As markets and clients become more sophisticated and the economy more integrated globally, it becomes necessary to explore strategic partnerships to mutual advantage. MET should not and cannot remain a local company. It is time for MET to go global and it has found that strategic partner that can take it to the next level,” the CEO said.
The acquisition is in line with Hollard’s objective to expand and managers of the African insurance giant said it would support MET Insurance with the objective of optimising its operations in Ghana to grow market share.
Hollard is a large corporation with a global reach. Based in South Africa, the insurance group has a global strategy which has seen it open branches in China, India, Pakistan as well as Zambia, Mozambique, Namibia and Botswana. Ghana is its first stop on its West Africa roadmap, after three years of discussions with MET Insurance.
“Our turnover is US$1.4 billion, our assets US$2.4 billion and profit before tax of US$250 million. So we have significant financial strength to invest in MET,” the Chief Financial Officer of Hollard, Mr Brooks Mparutsa, said.
He explained that Ghana offered one of the most promising and dynamic insurance markets in West Africa, considering.
The country’s short-term insurance industry generated turnover of over US$150 million in 2013, but more significantly grew by over 25 per cent over the past five years, which makes it one of the most rapidly growing insurance markets in the world. GB
