Insurance companies may struggle to settle claims promptly in the coming days.

This is as a result of their participation in the Domestic Debt Exchange Programme.

Currently, significant portion of the industry’s investment incomes are from government bonds.

However, the industry recently reached an agreement with government to participate in the ongoing Domestic Debt Exchange Programme targeted at bringing the economy back on track.

But speaking at his outfit’s 8th educational conference and exhibition, President of the Insurance Brokers Association of Ghana (IBAG), Shaibu Ali, said it is time for the industry to re-strategise to avert a possible crisis.

“Through the insurance sector’s commitment to supporting government to achieve economic stability and growth, the industry recently reached an agreement with the government regarding the Domestic Debt Exchange Programme which poses difficulties to both insurance companies and broking firms”, he mentioned.

Mr. Ali added “insurers are losing investments that would have facilitated the prompt settlement of claims; Brokers, on the other hand, are losing investment that would have ensured their effective running and for the benefit of their shareholders.”

Underwriting Profit

Meanwhile, Chairman of the Education and Publicity Committee of the Association, Stephen Kwarteng Yeboah says the industry must consider moving from its over-reliance on investment income to underwriting profit.

“There’s the need to do self-assessment and share opinions on how we can change the narrative of depending on investment income rather than underwriting profit”, he pointed out.

Me. Kwarteng Yeboah added “this is an urgent subject matter in our industry following the recent Domestic Debt Exchange Programme undertaken by the State, and the implementation of the IFRS 17.”

The 8th IBAG Educational Conference and Exhibition in Sunyani is on the theme “The Effect of the Global Economic Challenges on the Ghanaian Insurance Industry.”

It commenced on March 21 and will end on March 25, 2023.