The National Insurance Commission (NIC) has suspended the implementation of the directive on the Enhanced No Claims Discount.
According to a statement from the NIC, the decision to suspend the directive was after much deliberation with key stakeholders of the insurance industry.
“This decision is to enable the Committee, which will be set up in conjunction with Ghana insurer Association (GIA) and Ghana Insurance Brokers Association (GIBA), to review and come up with conclusive modalities on the implementation of the Enhanced No Claim Discount Directive. The new date for the implementation of the directive will be communicated in due course,” the statement signed by the Commissioner of Insurance, Justice Yaw Ofori said.
The Commission earlier this month directed all insurance firms to discontinue granting discounts on premiums under the “Enhance No Claims Discount” directive.
According to the NIC, the directive formed part of measures to deal with some unhealthy practices believed to be hurting the industry.
Concerns with the directive
There were fears that this may increase the cost of premiums thereby pricing out some policyholders.
Some argued that for instance if one was now paying GH₵100 for a 50 per cent discount on a policy, doing away with this practice would definitely increase the premium to about GH₵200 Ghana.
NIC on concerns
According to Mr Ofori there is no way that this would cause an increase because there is a minimum approved price that all the insurance firms should be working with.
He added that “we don’t want what happened in the banking industry to happen to our sector that is why we are taking these steps”.
Mr Ofori was of the view that the directive would result in enhanced benefits for policyholders in the country.
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