The Deputy Commissioner of insurance at the National Insurance Commission (NIC), Kofi Andoh, has said the commission is putting together a regulatory framework to help protect the annuity products as well as the annuitants.
Annuities are insurance contracts that provide a fixed income stream for a person’s lifetime or a specified period of time. An annuity can be purchased with a lump sum or a series of payments and begin paying out almost immediately or at some point in the future. Annuities are often used as a way to fund retirement.
According to Mr. Andoh, the market is quite new, therefore, NIC together with its stakeholders are looking at ways to ensure that specific life insurance companies selling the products meet relevant requirements and competencies to shield customers.
“As regulators, we are also working on a regulatory framework that will help us properly regulate this product to make sure that the annuitants are protected. It will help us to effectively do this by knowing what type of competencies an insurance company needs to have to sell annuity. This is a new market and we just need to make sure we put the appropriate measures in place to ensure that everybody is protected,” he said during the annuities campaign launch in Accra.
As part of efforts to ensure the market remains strong and buoyant to serve the needs of customers, the NIC has also built the capacity of some life insurance companies – of which five have been given the opportunity to sell annuity products that have met requirements.
The launch
As part of ensuring that the general public are sensitised on the benefits of annuity, the NIC has partnered with key stakeholders, with support from Deutsche Gesellschaft für Internationale Zusammenarbeit (GlZ), on behalf of the German government to roll-out a series of nationwide public awareness activities for the ‘Annuities Campaign’ – to create significant awareness about its importance as a great tool for financial independence during retirement.
The campaign’s objectives will be achieved through the use of television, radio, social media and public engagement outreaches which are scheduled to run till end of the year, and are expected to reach some one million Ghanaians.
Mr. Andoh, highlighting the importance of annuities said: “The benefits associated with annuities cannot be overemphasised: financial security, liquidity, guaranteed lifetime income supply, maintenance of lifestyle and ability to cope with unforeseen and unplanned expenses, to name a few”.
Speaking at the media launch, Head of the Programme for Sustainable Economic Development at GIZ-Ghana, Detlev Axel Jahn, said GIZ is excited about the campaign and predicts it will bring a tremendous amount of value to the entire Ghanaian insurance industry. He said GIZ will continue to pledge its support and partnership to the insurance industry for projects and collective measures benefitting stakeholders.
