Compliance improves Insurance Industry’s Performance

The unwavering stance of the regulator, National Insurance Commission (NIC), to drive insurance growth and ensure strict compliance with relevant laws affecting insurance business has increased investors’ confidence in Ghana’s insurance industry.

Some of these policies recently enforced by the regulator include enforcement of the Local Content Risk in the Oil and Gas Sector, anti-money laundering measures, the full adoption of International financial reporting standards by insurers, the ‘No Premium, No Cover’ rule, and a drive for retail products through micro insurance that has resulted in the industry’s improved performance.

Insurance companies now adhere strictly to promptly submitting quarterly reports to the NIC. Though this report is not based on the full year that ended December 31^st, indications show that 2015’s audited accounts are expected in February.

However, operating performance of all classes of insurance business (Life and non-life figures in relation to gross premium income, claims paid, management expense, investment income and net profit before tax presented in this report) is audited.

The industry experienced a slight growth in the volume of business underwritten by the close of third quarter 2015, with recorded gross premium of GH¢660,999,425. This income was earned by 24 out of the 25 non-life operators, while 19 out of 21 life underwriting companies earned GH¢513,525,977 in the period under review.

Life Insurance

Claims paid by 23 of the non-life operators amounted to GH¢191,436,121 while life benefits paid was GH¢276,403,244. However, the first half of 2015 was characterised by a lot of claims due to the heavy rainfall that resulted in flooding last year.

Total management expenses for the non-life companies stood at GH¢257,387,953 while life operators’ management expenses was GH¢156,613,204.

Investment income both life and non-life stood at GH¢175,971,269 and GH¢77,118,379 respectively.

17 out of the non-life companies under review recorded underwriting losses against 19 life underwriters. These companies recorded a total of GH¢164,379,944 underwriting loss.

Indeed, total net profit before tax of all the non-life companies stood at GH¢55,658,007 — while Life insurers recorded total net profit before tax of GH¢38,374,522.

Non-Life