The country’s biggest Re-insurer, Ghana Reinsurance Company (Ghana Re) has told Citi Business that some 21 insurance companies are indebted to it to the tune of 50.5 million Ghana cedis.

The outstanding debt comprises default in the payment of re-insurance premiums by the insurance companies over the years.

According to Ghana Re which is mandated by law to re-insure insurance policies issued by all the insurance companies in the country, the debt has been hovering around 50 million Ghana cedis for the past two years.

In exclusive interview with Citi Business, the Managing Director of Ghana Reinsurance, William-Agbenyaga attributed the debt to mainly the review of re-insurance policies coupled with the accumulated premium-credit debt triggered by competition.
“We write three types of insurances. We have the facultative, the treaty and the legal section. Now that the legal session has been withdrawn, and we have now asked them to convert it to quota share, we will sit down with the insurance companies to negotiate terms that instead of the 27.5% some of them are able to negotiate up to 50%. The companies have been paying the legal and the treaty but we have a problem with the legal section.”

Of the 50.5 million debt, the biggest insurance company, SIC Insurance owes the highest amount of almost 19 million Ghana cedis followed by Star Assurance Company which owes over 4 million Ghana cedis.

Also is Vanguard Assurance whose debt is almost 4 million Ghana cedis among others like Ghana Union Assurance and Enterprise Insurance Company.

These outstanding debts owed Ghana Re has been growing over the years and dates as far back as 1972 when the company was established. Mr. Agbenyaga said this necessitated the intervention of their board sometime in 2004 to ease their burdens.

Source: citifmonline

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