Senior Minister Yaw Osafo-Marfo has said Ghana’s and Africa’s industrial dream is dependent on a well-developed insurance sector, capable of pulling together resources to support long-term development.
Speaking at the opening ceremony of the African Insurance Organisation’s (AIO) 45th Conference and Annual General Assembly in Accra, Mr. Osafo-Marfo said it is high time the continent harnessed its insurance potential through integration and capacity sharing, which he said is vital to solving the lack of long-term funds.
“The biggest problem facing Ghana and the rest of African countries is lack of term-term funds to support industry and agriculture. Most banks in Ghana have a lot of short-term funds – deposits, which are around 90 days. When you superintend over such funds, industrial development becomes a problem because you may be tempted to use short-term funds for long-term development – and that is not good enough.
“The industry that has the key to medium and long-term funding is the industry insurance; therefore, the solution to Africa’s financial sector on the whole hinge on the insurance industry. You must therefore see yourselves playing that role to lead Africa to its transformation,” he said.
Given the long-term nature of insurance funds, he said, they could be the catalyst for not only driving economic transformation but business and investor confidence in African economies.
He therefore charged participants to come out with solutions that can transform the continent’s insurance industry into a key pillar of the financial sector, which can then contribute meaningfully to infrastructure development.
Themed ‘Innovation, risk and future of insurance in emerging markets’, the event brought together over 1,000 delegates from the world-over to share and exchange ideas and promote integration among countries.
The event runs from May 6 – 9, and also aims to find tune ways of improving insurance penetration as well as increase the sector’s contribution to financial sector and national development.
President of AIO, Alhaji Kaddunabbi Ibrahim Lubega, said despite efforts by African countries, insurance penetration as a percentage of population in most countries still remains below 2 percent.
“The continent’s low insurance penetration still presents one of the market’s largest opportunities,” Alhaji Ibrahim said, urging industry players to re-engineer strategies to attract and protect the insuring public.
He also called on players to use technology to optimise their business as it provides an avenue for innovation and efficiency, adding that: “Our mastery of new technologies remains a fundamental tool to innovations and our onward march toward emergence of the African insurance industry”.