The 2015 West African Insurance Companies Association (WAICA) Conference slated for April 2015 will still come off as scheduled, in spite of the threat of Ebola in the West African sub-region. This was disclosed to the Graphic Business by the President of the Ghana Insurers Association (GIA), Mr Ivan Avereyireh.
The ninth President of the GIA, who is also the current Vice-President of WAICA and the Chief Executive Officer (CEO) of Ghana Life Insurance Company made this known when Graphic Business caught up with him and asked about the plans of the trade body in 2015.
Responding to a question on any fears regarding Ghana hosting the WAICA Conference which will bring CEOs of all insurance companies in the sub-region to Ghana, in light of the threatening Ebola epidemic, he said: “Yes, Ebola has been a major setback to business interactions in the past few months but it is only a few countries that have been affected. Besides, measures are being put in place to ensure that the testing machines at the various borders are utilised, particularly by participants from the few endemic member states”, he intimated.
Projections
Asked what he hoped to achieve during his tenure as the GIA President, he indicated that the industry’s major challenge was how the low insurance penetration rate which stood at 1.42 per cent as of December 31, 2013 would be tackled.
Other challenges which he cited, are the public’s perceived delays in the payment of claims and low motor insurance premiums in the face of high injury/accident claims, which he said he would focus on.
One other challenge he hopes would be tackled is the high surrender rate from life insurance policyholders, which can be attributed to the challenges the economy faced, particularly in 2014.
Effect of the 17.5 per cent tax His biggest headache now is the 17.5 per cent tax being slapped on financial institutions, which will pose as a challenge to the target of achieving a penetration rate of three per cent.
“If this happens more individuals and small to large-scale industries would be discouraged from patronising insurance products and services and this could have a cyclical effect on the economy since revenue generation would be affected if companies fail to bounce back as a result of little or no insurance on their assets which could make a bad situation worse”, he lamented.
Tax rebates for non-life companies
He further stated that “since it is a legal requirement that life returns to the Ghana Revenue Authority (GRA) qualifies one for rebates on income tax for life policyholders, it would be in place to have the same arrangements for non-life policyholders”, he strongly advocated.
Support for the no premium, no cover
Mr Avereyireh was particularly delighted at the fact that the implementation of the No Premium, No Cover (NPNC) policy instituted last year in the country by the National Insurance Commission (NIC) is yielding the needed results, making most non-life insurance companies more liquid. He was quick to add that though its implementation was good, that did not take away the initial teething challenges encountered at the beginning of its implementation. He indicated his continuous support for the NPNC as it has become obvious that policyholders are beginning to understand the policy more and this would be further strengthened by the GIA to firmly entrench it.
Apathy towards GIA activities
Asked what the current situation was, with regard to the apathetic attitude exhibited by some CEOs towards the trade body’s activities to help move the industry forward, the GIA President intimated that in recent times however, there had been an improved interest. In an attempt not to hold brief for some of these CEOs, he indicated that members had come to appreciate that by law, every insurer was mandated to be a member of the GIA. There was therefore a significant improvement in participation by members.
“To ensure the full participation of all stakeholders we are restructuring the programme of the insurance awareness week and the Life Conference instituted by the previous administrations to involve all key stakeholders (the NIC, GIC, GIBA, IIG, GIAA) to make the industry more formidable and stronger in its operations”.
He expressed delight that in 2014, there was the highest number of subscriptions and most arrears had been defrayed by some member companies.
Increased responsibilities
Asked how he had been able to manage his positions as the GIA President and CEO of Ghana Life Insurance Company alongside other positions in the sector in the West African sub-region, the chartered insurer cum arbitrator, had only one sentence to describe how he was managing it: “I am a very effective time management strategist and able to manage all the positions alongside having time for my family and friends”, he hinted.
Increase of insurance companies
On his thoughts on the high rate of proliferation of insurance operators joining the fray and thereby stretching the already competitive but relatively small market size, he intimated that he was rather excited by the competition and ethics the industry stood to benefit from as that would increase the insurance penetration rate. Additionally, he believes that it would bring about divergence of ideas, especially from acquisition and mergers since foreign expertise and employment opportunities would come to the fore of the industry’s operations. It will also encourage professionalism and competitive pricing in the Ghanaian insurance market for companies to fall in line.
Strategies to increase the ienetration Rate
Asked about the strategies he and his Team at the GIA Board had to enable them move the current penetration rate of 1.42per cent to their targeted 3per cent within two years, he mentioned the fact that the trade body would support all companies poised to strengthen the introduction of insurance policies for the largely untapped market as in Micro Insurance (informal sector) and Up-Market segments of the economy which are largely untapped.
Review of the motor insurance premiums
He also mentioned the fact that during his team’s tenure they would champion the cause of reviewing the current motor insurance rates as its low status now was taking a toll on most non-life companies in the face of the increasing carnage on our roads.
He also indicated that there is currently a marketing team working in the Brong Ahafo and the three northern regions to bring together ‘’nuclear farmers’’ to grow the portfolio of agric insurance with support from the German Development Corporation (GIZ) and the USAID- FINGAP.
His motivation
As an ACII, and arbitrator, the CEO of Ghana Life Insurance, the Vice-President of WAICA, a fellow of the Insurance Institute of Ghana and a member of the academic board of WAII with many long years of insurance experience since early 1980s, he cited his motivation as doing everything possible to see the uplift of the industry with the passion it deserves so that when he leaves the industry, he would be fondly remembered for helping build a solid foundation for other generations to build on.
Family responsibilities
With a large family of five children and a beautiful supportive wife, the president was quick to add that one of his children currently studying medicine, believed that he would certainly be of value to the insurance industry since the two fields work together for the national good. GB