‘Pay premium promptly’
The Chief Executive Officer of Safety Insurance Brokers Limited, Ms Lena Adu-Kofi, has emphasised the need for insurance companies to pay the premiums of their clients promptly.
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She said there was enough evidence that insurance companies in the country had huge amounts of outstanding premiums which eventually led to bad debts.
That, according to her, was inimical to the growth of the industry in Ghana.
“To us, insurance is a promise to pay claims, and we jealously guard our promises, so it is important for us to bring this information to you, our cherished clients,” she stressed.
Ms Adu-Kofi was speaking at the first-ever insurance companies’ forum organised by the Safety Insurance Brokers Limited in Accra last Friday.
The day’s seminar brought together stakeholders, clients, freight forwarders, experts in the industry and officials from the National Insurance Commission (NIC) to discuss ways of handling the challenges that had bedeviled the industry over the years.
The forum was also used to discuss the new directives issued by the NIC which will take effect from April 1, 2014.
Industry challenges
Ms Adu-Kofi indicated that the inability of insurance companies to pay the claims of clients promptly created serious credit risk exposures to both insurers and reinsurers, adding, “when premium debts are written off it creates complications for reinsurers.”
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She added that the situation created uncertainty as to the capacity of many insurers to meet their obligations.
NIC directive
Speaking on the new directives by the NIC, she noted that they were harsh on the insurance companies, adding that applying punitive measures on companies which might violate the orders was not the best.
In spite of this, Ms Adu-Kofi called on companies within the industry to pay the claims of clients promptly, noting that it was obligatory.
For his part, the head of inspection at the NIC, Mr Michael Andoh, said the new directive was in the interest of clients and stakeholders, adding that the NIC was not against anyone.
He stressed the need for the companies to ensure strict compliance with the new directive to avoid the wrath of the commission.
Daily Graphic