Dr. Justice Yaw Ofori, Commissioner-National Insurance Commission, has disclosed that a total of GH¢320million was transferred to foreign reinsurers in 2020. According to the Commissioner, GH¢190million was also transferred by the close of the second portal in 2021.
He made this disclosure at the 12th awards ceremony while commenting on the Africa Continental Free Trade Area, the agreement and its impact on the insurance industry in Accra last week.
According to him, over the years, the NIC has tried to grow the insurance sector by directing that local market capacity is fully utilised before recourse to overseas reinsurance arrangements.
“The Commission has directed that ceding companies must be granted approval before making an overseas transfer. These directives, however, appear not be making the desired impact as a result of the markets’ limited capacity – and to some extent, limited expertise – to underwrite certain specialised risks.”
The Commission is enjoined by the Insurance Act to approve all reinsurance arrangements. Generally, this is aimed at developing the sector since it promotes a system wherein each insurer has access to risk emanating from the local market.
Hence, to ensure that local capacity is fully utilised before any recourse to overseas reinsurance, the Commission grants approval for all overseas reinsurance premiums and risk transfers.
