Beginning on February 1, 2025, motor insurance prices in Ghana will increase, as announced by the National Insurance Commission (NIC). “The (price) adjustment is designed to help insurance companies meet rising claims costs while continuing to provide value to their customers”, the announcement noted.
Why did the price change?
In a general sense, insurance pricing is affected by inflation and claims levels. When prices of car parts increase at Abossey Okai, Kokompe, and Suame Magazine, insurance companies are compelled to charge a little more so they can be in a healthy financial position to pay claims. Secondly, when insurance companies record unusually high claims levels over a period of time, their ability to pay claims could be compromised unless they adjust prices upwards.
What is increasing, and by how much?
Ghana recorded an annualised inflation rate of 19.53% in 2024. This means that the prices of goods and services increased on average by almost 20%. However, the insurance industry is only increasing the third-party portion of motor insurance prices by 10%.
The new pricing breakdown
The 10% price increase affects only third-party premiums. This means that Comprehensive policyholders will only see an increase in the third-party element of their pricing which will end up as a much smaller percentage of their total premiums.. This point is worth explaining a bit.
Here’s how it works:
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If you paid GHS 482 for Third-Party Only coverage last year, you will now pay GHS 530; an increase of GHS 48.
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If you paid GHS 3,300 for Comprehensive Coverage, your increase will not be 10% of that amount. Instead, you will only see the same GHS 48 increase; amounting to just 1.45% of your total premium.
You can check how much you will be paying for your car by using this simple Motor Insurance Price Checker.
What you can do as a vehicle owner or driver
Much as the price increase is necessary for insurance companies to pay claims and fulfil their obligations, it leads to an unwelcome impact on every vehicle user’s pocket. The following are some ways that you can minimise how the motor insurance price increase hits your finances.
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Prioritise Comprehensive Coverage:
The price for comprehensive coverage is the least affected. If you are a comprehensive policyholder, you can keep moving without too much impact. If you are currently on third party only coverage, it is highly advised that you consider switching to Comprehensive coverage now. Comprehensive coverage gives you peace of mind when your car is stolen or damaged as a result of a collision, flood, fire, impact, earthquake, or civil commotion among others. And let’s add that you do not generally need a Police Report to claim damages to your car if you opt for comprehensive cover.
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Go for “Pay Small Small“
The National Insurance Commission has a directive that mandates all motor insurance premiums to be paid upfront. The NIC has, however, approved for a few insurtech companies to pilot flexible payment options. Brolly is one such company that is leading in offering monthly, weekly, and daily payment options to policyholders. Brolly provides a seamless digital platform that allows policyholders of all insurance companies to get full coverage under the “pay small small” scheme.
The Brolly “pay small small” option makes it affordable to get your motor insurance without the financial stress of upfront payment.
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Plan Ahead:
By budgeting for insurance in advance, drivers can better manage their finances and avoid unexpected financial burdens during renewal periods. Brolly has a feature that allows you to pay small regular amounts towards your next motor insurance renewal. You can learn more here.
Key Takeaways:
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Third Party Motor Insurance prices are increasing by 10% from February 1, 2025
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The impact on Comprehensive policyholders is significantly lower
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You can opt to pay small small options to minimise the impact of the price increase on your pocket
