Ghana’s Insurance Sector Sees Asset Growth of 180% Over Six Years
Ghana’s insurance sector has experienced a period of remarkable growth, underscored by a substantial increase in total assets and Gross Written Premiums (GWP). This surge reflects a burgeoning confidence in the market and a broader array of insurance products available to the Ghanaian populace.
President Nana Akufo-Addo highlighted these developments during a statement delivered by his Chief of Staff, Akosua Frema Osei-Opare, at Enterprise Insurance’s centennial celebration.
The total assets of the domestic insurance industry have grown from GH₵5.4 billion in 2017 to GH₵15.1 billion by the close of 2023 marking a 180% surge in assets value. Parallelly, the sector’s GWP has surged, almost quadrupling from GH₵2.4 billion in 2017 to GH₵8.1 billion in 2023.
This exponential growth in GWP mirrors a strengthened confidence in the insurance market and an expansion in both the variety and reach of insurance products available to Ghanaians.
Despite these positive developments, the insurance penetration rate remains modest at 1%. However, insurance coverage, which measures the percentage of the population covered by insurance, has shown considerable improvement, increasing from 29% in 2016 to 44% in 2022.
This growth in coverage indicates a significant broadening of the market’s reach and a deeper integration of insurance services into the daily lives of Ghanaians.
In his statement, President Akufo-Addo underscored the government’s role in fostering a conducive environment for private sector growth.
“A key component of that conducive environment is an insurance industry which is robust and fit-for-purpose,” he stated.
Since 2017, the government has implemented significant measures to strengthen the insurance sector, including the passage of the Insurance Act 2021 (Act 1061). This legislation aims to equip the regulator with more effective supervisory powers, ensuring a stable and financially resilient industry.
Furthermore, new minimum capital requirements have been established to ensure that insurance companies possess the necessary capacity and resources to underwrite substantial business risks and optimize their retention.
President Akufo-Addo also highlighted the importance of inclusivity and innovation within the insurance sector. He urged industry players to champion products that cater to the financially excluded and underserved populations, particularly those in the informal sector and small business enterprises.
He emphasized the need for suitable and affordable agricultural insurance services to support both commercial and smallholder farmers, noting that the growing economy will likely spur increased demand for innovative insurance solutions.
In response to these evolving market dynamics, the president encouraged insurance companies to embrace new technologies and develop solutions tailored to the changing needs of the community. By leveraging digital advancements, insurers can enhance their outreach and efficiency, ultimately driving greater market penetration and inclusivity.
The trajectory of Ghana’s insurance sector signifies a positive outlook for the future. The substantial growth in assets and premiums, coupled with increased coverage, suggests a robust and expanding market.
With continued support from the government and a focus on innovation and inclusivity, the insurance industry is well-positioned to contribute significantly to Ghana’s economic growth and development.
As the market evolves, the onus is on industry stakeholders to adapt and innovate, ensuring that they meet the diverse needs of the Ghanaian population while maintaining financial resilience and stability.
The steps taken thus far signal a promising future for the insurance sector, one that holds potential for substantial contributions to the nation’s economic landscape.
