Persistently low insurance penetration is eroding public confidence and weakening the sector’s ability to pay claims promptly, according to Dr. Kingsley Agyemang, Member of Parliament for Abuakwa South.
Speaking on Adom TV’s Evening News, Dr. Agyemang stressed that the root problem is simple: too few Ghanaians are buying insurance.
“Insurance thrives on the principle of large numbers,” he explained.
“When more people contribute, the pool can comfortably pay the few who make claims. But with low participation, even routine claims strain the system.”
He likened the situation to tossing a coin: “If you toss a coin a thousand times, the results even out. But with just ten tosses, the outcome could be skewed. Insurance behaves the same way—the larger the pool, the more predictable the claims, the steadier the payouts.”
Dr. Agyemang warned that limited patronage makes it difficult for insurers to build strong, diversified portfolios, forcing them to tighten underwriting, delay claims, or raise premiums—further feeding mistrust.
“Nothing rebuilds confidence faster than prompt, transparent claims handling,” he noted.
He identified public education as the industry’s most urgent task. Insurance, he said, remains abstract for many households until disaster strikes. Sustained outreach, translated into local languages and illustrated with relatable examples, can demystify premiums, exclusions, and claims processes.
“The consumer is not consuming—and that is where the gap is. The media has the biggest responsibility,” he emphasized.
The MP urged insurers to adopt plain-language policy summaries, introduce incentives such as no-claims bonuses, and bundle simple covers into everyday transactions, from ride-hailing apps to market purchases, to normalize insurance use.
Diversifying portfolios across life, health, motor, agriculture, and micro-insurance, he added, would strengthen cash flow and make premiums more affordable.
While acknowledging progress in capitalization and product variety over the past two decades, Dr. Agyemang said growth has not kept pace with Ghana’s evolving risks, from urban mobility to climate-related shocks.
“The industry has improved, but the progress does not match today’s demands. Insurance is a numbers game. Until more Ghanaians buy cover, the system will struggle to deliver the reliability people expect.”
Source: Adomonline
