Finance and Economic Planning Minister, Dr. Kwabena Duffuor, on Thursday asked life Insurance Companies to extend their products and services to the informal sector.
“Life Insurance cannot have a full impact upon our people if practitioners fail to turn to the informal sector which constitutes more than 60 per cent of our productive economy,” he said.
Speaking at the opening of the 2009 Africa Insurance Organisation (AIO) Life Conference in Accra, Dr. Duffuour regretted that Insurance products and services are mostly designed and developed for the small and shrinking formal sector.
The Finance and Economic Planning Minister said as a matter of urgency, governments and practitioners on the African continent should create an enabling environment for the development of the informal sector which has become technically known as micro assurance products.
“This way, I believe me would go a long way to improve the life insurance sector’s contribution to Gross Domestic Products (GDP) in our respective countries,” Dr Duffour stated.
He said as a result of the key role that Life Assurance plays in the development of the economy, the government passed a new insurance law in 2006, which required the separation of Life Insurance from Non-Life Insurance Products, adding that, this has led to the registration and licensing of 17 Life Insurance Companies in the country.
This new development, Dr. Duffour noted, has made the industry more competitive and vibrant as companies have begun to explore innovative ways which they canpenetrate new and existing markets.
In her address earlier, National Insurance Commissioner, Ms Josephine Amoah, said the four-day event was being held in Accra at a critical period, given the Global Financial Crisis and its devastating effect on many economies.
She said even though African economics have generally not been directly hit by the global economic down turn, the insurance industry on the continent cannot be said to be immune from the effects of the crisis.
The Insurance Commissioner reminded African Life Insurance companies to learn from the experience of their counterparts in the developed economies and take urgent steps to forestall any failures in their markets.
Ms Amoah used the occasion to appeal to Life Insurance Companies in Africa to keep their products simple and affordable, concentrate on insurance protection polices, spread their investments and strengthen their capital base.
Held under the theme: “Gateway to Africa,” the four-day conference was attended by Life Insurance executives and partners from Ghana and other Africa countries.