THE CHARTERED INSURANCE INSTITUTE OF GHANA (CIIG); A SOLUTION TO THE MAL-PRACTICES IN THE INSURANCE INDUSTRY?

The Chartered Insurance Institute of Ghana (CIIG) held its first residential educational conference at the Ada, in the Greater Accra region. Someone will say it is long overdue to have insurance professionals coming together to deliberate about the industry. The industry could receive the necessary recognition and grow well when we have a lot of professionals who are committed to a better course.

A clue could be taken from the Chartered Accountants, Legal practitioners, Economists, Bankers and others. A unified voice is always heard above separate individuals’ voices.

Insurance professional practitioners coming together from these various industry players such as the Insurance Companies, Insurance brokers, Reinsurance Companies, Reinsurance brokers, Agencies, Loss Adjusters, Loss Assessors, surveyors and other insurance legal practitioners and also the regulatory body, National Insurance Commission (NIC), can help address all the issues about this industry. This is a great idea to revive and make the CIIG strong.

For any economy to grow, you need a strong and sustainable insurance industry. Insurance penetration in Ghana is very low. According to the NIC 2017 report, most insurers were not able to meet their top line as well as their bottom line. Some of the reasons have been attributed to some of the mal-practices which include insurance premium undercutting and payment of illegal fees to employees of clients.

But the question is, can the CIIG be the solution to the malpractices in the industry? The CIIG brings all the people working in the industry together with individuals not wearing the shirts of their companies. The theme for the education conference was “Professionalism, Integrity & Excellence – the way forward for the insurance industry”. The president of the body admitted in his speech that, the most highly rated industry threat today remains “undercutting”.  He also reiterated that despite our best intentions and efforts in the past as an industry; the time has come to shift focus and emphasis from the business as a going concern to the role of the professionals within the industry and for that matter the underwriter and his/her prudence.

The main issues that were discussed included undercutting of an insurance premium which is a big threat to the industry after they have been able to deal with the canker of insurance on credit with NPNC. The second issue was on illegal payments made to employees of insurance clients. This hampers the work of brokers and agents as the Insurance Act 2006 Act 724 prohibits such payments.

How does the insurance industry handle this? CIIG is a unifier and brought all these industry players together. The president of the institution said, “change only happens when we get to know who we are and introduce self-regulation into our lifestyle for change. The attitude of some of us towards claims settlement at the point of need of the public (our clients) lack empathy and contribute to the painting of the wrong image of insurance as an extortion business rather than providers of peace of mind”. CEOs and MDs and other professionals also presented their concerns. But the inkling is, we are just shifting blames because we are the solution. We are the players in the industry. Let’s all agree to stop this canker and then we are done and fine.

How are other industries like banks able to follow all their directives? Each insurance player thinks they are outwitting the other and is leading the industry to a big pit. Insurers and insurance brokers and agents are paying monies they are not supposed to pay to clients’ employees and are also charging below the actuarial premium because they think their competitors would do the same or far more to have their business. Most insurance expenditures are immediate and catered for except claims which happen in the future. This also accounts for the reasons why most insurers are not able to meet their claims on time.

The CIIG would provide technical knowledge to members of the professional body but the truth is, it is always difficult as a human institution to have all professionals behave ethically and professionally. This means that the institute should have a code of ethics where Individual professionals could be sanctioned on wrongdoings.

Again, it becomes easier when all insurers CEOs and MDs agree to these two menaces and issue memos in their companies to desist their staff from doing these. If CEOs and MDS are fully committed to this course and enforce it like they are doing with other directives, as the NPNC, the industry would be on track and contribute to the economy of Ghana. We would then feel the impact and the change we want. We would be able to pay claims and the insuring public would begin to have confidence in the industry again. But, if CEOs, MDs, and Heads of Operations fail to agree, it then becomes difficult for the other young professionals to also agree with this.

If we cherish our industry as we say, let’s do it now or never!!!!!!