NIC Reaffirms Commitment to Risk-Based Capital Framework
The Head of the Actuarial Department at the National Insurance Commission (NIC) , Kwabena Osei-Mensah has reaffirmed the Commission’s commitment towards implementing a robust risk-based capital framework as Ghana positions itself to become the insurance hub of the Economic Community of West African States (ECOWAS) sub-region.
Speaking during a recent webinar by Deloitte Ghana on the theme “Risk-Based Capital in Ghana: Readiness, Reality and the Road Ahead,”, Osei-Mensah, highlighted that the move forms part of broader efforts aimed at aligning the country’s insurance sector with global regulatory standards, while also improving its competitiveness and attractiveness to investors.
He added that the framework is expected to strengthen the financial resilience of insurance companies.
“Ghana is looking to be a hub, an insurance hub, so aligning with global standards is our mantra, to be able to attract, I would say, investors, stabilise the market. I think one big thing is risk consciousness on the market, so the risk-based capital is really to drive that, so we have a very stable market, efficient use of capital also within the market to drive growth, and you know, when you have a stable market and confidence breathing in the market, you will have investors coming, insurance penetration should go up”
Mr. Osei-Mensah also outlined steps already taken by the regulator to advance the initiative. These include engagements with industry stakeholders through working groups, consultations with insurance companies, and the collection of data from volunteer firms to support the development of the framework.
He noted that the Commission has also conducted a mini quantitative impact study using the submitted data to assess how the risk-based capital framework could affect the insurance industry.
“So from the NIC’s perspective, this is a very exciting time, it sits right at the heart of the Commission’s objective, which is to grow the market in surety, so we are here today to help the journey. From our perspective, we have had a touchdown with the market, we’ve had a series of industry working group connects, that’s happened, this happened before my time, but I have seen one also happen during my time, we have gone on to collect data from volunteering companies, and we have had what you will call a mini-quantitative impact study in issuing this, in coming to this risk-based capital framework.”
The NIC has been working to modernise Ghana’s insurance regulatory regime as part of efforts to support the country’s ambition of becoming a regional insurance hub within ECOWAS.
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