Ghana’s insurance commission debunks claims of increasing cost of motor insurance by 100%, here’s the original cost

This follows when the NIC this week announced that it has stopped the issuance and use of the old motor insurance stickers effective January 20, 2020. But shortly after the announcement, some motorists reacted that the cost of insurance policies have gone up.

The Commissioner of the National Insurance Commission, Justice Yaw Ofori speaking at a press briefing, explained that some insurance companies were under-valuing their policies but with the introduction of the digital platform known as the Motor Insurance Database, all companies have been compelled to adjust their rates to the original cost.

“The rates have not been increased. I believe that some of the companies are now complying with the directive not to undervalue their product because the new digital platform will reject anybody trying to undervalue a policy to beat the competition,” he said.

Adding that the regulator will not allow insurance companies to abuse the rules in an attempt to attract more customers.

He warned that undervaluing insurance policy makes companies financially vulnerable when there is an accident and customers come for their claim.

Meanwhile, the MTTD of the Ghana Police Service says it is ready to enforce the new Motor Insurance Database.

Superintendent Daniel Sasu Mensah is Head of Operations at the MTTD told journalists the police are ready to implement the directive.

Background

The National Insurance Commission (NIC) on Monday, January 20, 2020, announced that it has stopped the issuance and use of the old motor insurance stickers.

According to the commission, the decision was taken after rolling out a new electronic motor insurance sticker.

NIC announced this in a statement it issued to the public to among other things ensure the safety of the general public and curb the phenomenon of fake motor insurance stickers.

The Commission, which is the regulatory and supervisory body of the insurance services sector in the statement said it has with a broad consumer and prudential regulatory mandate under Section 2(3) of the Insurance Act 2006, (Act 724) commenced the implementation of the Motor Insurance Database (MID), effective 1st January 2020.

The objective of the introduction of the Motor Insurance Database (MID) is to curb the menace of vehicles with fake motor insurance stickers plying the roads, thus endangering lives and property.