• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home highlights

Insurance industry solvency risks fairly contained – Report

4 years ago
in highlights, Home, home-news, Insurance, latest News
2 min read
0 0
0
100
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

Insurance industry solvency risks fairly contained – Report

The Bank of Ghana (BoG) in its 2020 Financial Stability Review report has said solvency risks present in the local insurance industry is fairly contained.

According to the Central Bank, in the year 2020, the industry’s Capital Adequacy Ratio (CAR) – a metric that measures the quality of available assets to meet obligations – stood at 415 per cent and 328 per cent for the life and non-life insurance subsectors respectively.

Exceeding the minimum requirement of 150 per cent CAR for both the life and non-life insurance industry in the review year.

Adding that, the industry’s total capital base increased to GHs 2.91 billion at end-December 2020 from GHS 2.53 billion at end- December 2019, a growth of 15 per cent over the financial year.

Solvency risk in the insurance industry, the BoG asserts was mitigated by the National Insurance Commission’s (NIC) GHS 50 million new minimum capital requirement directive to insurance firms in the country.

“To address solvency risk, the NIC has increased the minimum paid-up capital for the insurance industry. Insolvent insurance companies could leave policyholders exposed to various threats. To mitigate solvency risks and improve confidence in the insurance market, the NIC is enforcing a new minimum capital regime from 1st January, 2022 and is currently engaged with industry participants to ensure that companies are able to meet the new directive,” stated the BoG in the report.

RelatedPosts

Chamber of Agribusiness Calls for Sector-Wide Price Cuts and Urgent Government Support to Curb Food Crisis

The Perils of Market Interventionism: When Political Pressures Threatens Ghana’s Economic Gains – The Way Forward

GAB Projects Drop in Lending Rates Starting August 6 Following BoG’s 300bps Policy Rate Cut

“The outlook for the solvency position of insurance institutions within the industry remains positive especially with the on-going recapitalisation exercise,” the BoG added.

The on-going recapitalisation of the insurance industry the Central Bank further noted, is expected to further improve retention of insurance business in the country.

According to the Bank, in the year under review, non-life insurers retained 66 per cent of premiums, as compared to 84 per cent by life insurers. The lower retention ratio of non-life insurers was due to the nature of the risks underwritten and the high gross insurance risk ratio.

Gross premiums within the insurance industry, the Central Bank also noted, grew by 20.6 per cent in the review year. Gross premium at end-December 2020 stood at GHS 4.20 billion as compared to GHS 3.49 billion at end-December 2019.

The steady growth in gross premiums was attributable to the rollout of various alternative distribution channels on digital platforms and the introduction of a digital platform (Motor Insurance Database – MID) by the NIC in January, 2020.

Read This: Industry to underpin 5.8% GDP growth rate for 2022 – Tesah Capital

The MID, introduced in the review year, ensured that sales of insurance policies were not compromised during the pandemic and that premiums generated from motor insurance, were commensurate with the risks associated with the asset insured.

Total investment assets of insurance industry

The total investment assets of the insurance industry for the review period grew to GHS 5.7 billion at end-December 2020 from GH¢4.9 billion at endDecember 2019. In the non-life sub-sector, total investment assets amounted to GH¢1.9 billion, as compared to GH¢3.9 billion in the life sub-sector.

The total investment assets in both the non-life and life sub-sectors were concentrated in fixed income securities, with a gradual shift of investments to the real estate sector, moderating in 2020.

In the life subsector, investments were primarily in GoG and BoG securities (42.0%), investment properties (24.7%) and fixed deposits (19.5%). Similarly, in the nonlife sub-sector, investments were primarily in fixed deposits (28.5%), GoG and BoG securities (24.7%) and investment properties (24.7%).

Amid underwriting losses, investment income will continue to play a pivotal role in the near-to-medium-term sustainability of the Insurance industry.

Source: norvanreports
Tags: Bank of Ghana (BoG)COVID-19 pandemicghanaGhana: Solvency risk in insurance industry fairly contained - ReportNIC
No Result
View All Result

Highlights

Local Bourse Rallies Strongly as GSE-CI Hits Near 7,000 Mark

Treasury Exceeds Auction Target of GHS 3.86 Billion Amid Tightening Yields

BoG Raises GHS 15.38 Billion via 56-Day Bills to Reinforce Tight Monetary Policy Stance

Passage of Competition Law Key to Tackling DSTV’s Market Dominance – CUTS International

Why Are Interest Rates Still High? The MPR vs Market Rates Debate

Climate Change Is Making Africa’s Debt Burden Worse – New Debt Contracts Could Help

Trending

Agribusiness

Chamber of Agribusiness Calls for Sector-Wide Price Cuts and Urgent Government Support to Curb Food Crisis

August 4, 2025

Chamber of Agribusiness Calls for Sector-Wide Price Cuts and Urgent Government Support to Curb Food Crisis The...

The Perils of Market Interventionism: When Political Pressures Threatens Ghana’s Economic Gains – The Way Forward

August 4, 2025

GAB Projects Drop in Lending Rates Starting August 6 Following BoG’s 300bps Policy Rate Cut

August 4, 2025

Local Bourse Rallies Strongly as GSE-CI Hits Near 7,000 Mark

August 4, 2025

Treasury Exceeds Auction Target of GHS 3.86 Billion Amid Tightening Yields

August 4, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.