Only 6% of GH¢90bn imports in 2019 had local insurance

Tema Port

Data from the National Insurance Commission (NIC) have showed that out of the total value of cargo imported into the country – estimated at GH¢90billion last year – only 6 percent took insurance from Ghanaian insurance companies, indicating that the majority of importers rather took insurance from overseas companies, especially Asia.

The National Insurance Commission has told B&FT that the development is inimical to growth of the sector, and therefore measures have been taken to educate players in the shipping industry and also enforce the law to correct the wrong.

Speaking at the 7th Maritime Seminar for Journalist on the theme ‘Contemporary trends and development in Ghana’s shipping industry’, the Head of Supervision-NIC, Seth Eshun, said one danger from the development is that some of the language used in writing the insurance is not easy to read – and therefore when there are disputes over claims, the NIC finds it difficult to intervene.

As a result, the NIC is rolling out a sensitisation programme to create awareness among the trading public on need to take advantage of the law and regulatory framework in the country, which ensure that they have the best protection for all the categories of goods imported.

“If you took the insurance from China, how do you translate the document; and when there is a dispute, you cannot even rely on the regulator to help you,” Mr. Eshun said, adding that from preliminary investigation on the matter, the NIC realised that many importers are oblivious of the law and are more concerned about the importation of goods than the insurance on them.

“People may not know it is the law, and also this is partly because the law has not been enforced. Insurance is not something that people love to pay. We all know the benefit of comprehensive insurance for our cars, but we do third party. So, it is all about education for people to know, and then they will do the right thing,” he added.

He mentioned that the new insurance act, expected to be passed by parliament by the end of this year, will make the acquisition of marine insurance compulsory.

“In our new bill, we are introducing some new compulsory insurance. One of them is marine insurance. You need to buy insurance within your own jurisdiction – such that if your insurance company is using a technicality not to pay for your claim, you can resort to the insurance regulator for the company to pay. If you bought the insurance from China, who are you going to complain to if the insurance company does not pay?”

The NIC is also collaborating with some relevant stakeholders – Ghana Shippers Authority, Customs Division of the Ghana Revenue Authority, selected ministries and some professionals – to ensure smooth implementation of and compliance with the new Insurance Act.

The Ghana Revenue Authority will ensure that insurance is taken from Ghana before goods are actually taken out of the port, and the Ghana Shippers Authority will do the coordination.

Mr. Eshun added that the NIC will also be creating a marine insurance database in order to make it a lot easier for Customs to be able to check whether any goods imported into Ghana, apart from personal effects, actually have insurance in Ghana.

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