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The Obra Pa annuity product from Old Mutual – Ghana’s most innovative insurance company – has been heralded by experts as a vital tool in the country’s drive toward comprehensive financial inclusion and economic transformation.
The product, which offers retirees a guaranteed income stream for the rest of their life after paying an initial lump-sum, was created to enable them to enjoy all the positive aspects of retirement.
Speaking at the formal launch of activities toward Old Mutual’s introduction to the Ghanaian market, an Assistant Manager at the Standards and Compliance Directorate of the National Pensions Regulatory Authority (NPRA), Edward Edman Biney, stated that the product not only impacts the retirees directly, but also has a multiplier-effect on those within their close circles and consequently the wider economy.
“One thing that Old Mutual must certainly be commended for is development of the annuity product, as economic growth depends on individuals as well; and if the retirees have steady and reliable income through this product, then they will have a decent standard of living and this will reach those around them,” he said.
He also commended Old Mutual Penisons – which was one of the first five entities after deregularisation of the pension space to secure a licence to operate as a corporate trustee – for its wider impact in providing capital to the real economy.
“…as of March, Old Mutual has done about GH¢260million in terms of pension assets in Tier 2 and Tier 3; and these funds have been invested within the guideline prescribed by the NPRA… with these investments going back into the financial services sector, it represents critical funds to the state for crucial infrastructure projects as well as corporate institutions,” he explained.
These sentiments were similarly expressed by Head of Reinsurance and AML at the National Insurance Commission (NIC), Esther Armah, who said: “With the annuity product, Old Mutual collects a lump-sum from the retirees and frees it up. With that, retirees are able to spread their consumption over the course of the rest of their lives,” she noted.
Old Mutual Ghana’s Chief Executive Officer (CEO), Tavona Biza, said the growth that has been experienced over the last decade can be traced to the company’s vision, the rigid systems of checks and balances put in place, as well as the quality of its human resources.
Group CEO of Old Mutual West Africa, Donald Samuel Ogbu, said while success has been attained to a fair degree, his outfit will not rest on its laurels until it becomes number-one – not necessarily in premiums or profits, but areas such as customer satisfaction.
“What this shows us is that there is more work to be done; and we will not rest until we are number-one for innovation, number-one in customer satisfaction, number-one in value for money, and number-one is product offerings,” he said, adding that the local arm of Old Mutual will rely on the almost-200 years of experience the Group possesses.
Board Chair of Old Mutual Life Assurance, Helen Amarquaye, said she expects to see the integration of insurance and technology to drive coverage beyond what is currently available.
“We will see the insurance industry merging with other industries like fintech, which takes insurance to a wider group of people; there is microinsurance as well, so in terms of withstanding shocks it is not just limited to a certain class of people or the standard set of products… there will be partnerships which see entire nations and regions protected against catastrophe,” she said.
Her remarks come as conservative estimates suggest the insurtech market-size worldwide was assessed at US$5.45billion in 2022, and is predicted to grow at a yearly compounded rate (CAGR) of 52.7 percent from 2023 to 2030.