Speaking on Eye on Port, President of the Ghana Union of Traders Association, Dr. Joseph Obeng, advised that Ghanaian insurance companies should focus on building their capacities and make available attractive offers for importers and exporters.
“They have tried to sell their products to us, but they are not succeeding because they overprice the premium. Also, they claim that there are some of the items they can’t provide insurance covers for. Sometimes, they simply do not have the capacity,” the GUTA President recounted.
This comes in the wake of propositions by a tripartite committee involving the National Insurance Commission, Customs Division of the Ghana Revenue Authority and Ghana Shippers’ Authority to encourage the enforcement of the law that mandates importers to purchase Ghanaian Insurance Policies for all imported cargo.
According to Dr. Obeng, in attempts to build faith with the trading public in Ghana, local insurance companies should consider a form of insurance that would insure goods on land from the port to the destination of the goods, so that they can build a niche in the area before advancing the arguments of insuring all imports. He explained that, upon successful implementation of such onshore insurance activities, importers will now have confidence in the local insurance to procure their policies even for their offshore transactions.
On his part, Chairman of the Commission on Trade Facilitation at the International Chamber of Commerce-Ghana, Mr. Joseph Agbaga disputed the notion that local insurance companies have exceptional interest for Ghanaian businesses beyond those abroad, emphasizing that such argument cannot be the basis for making all traders purchase insurance policies from local vendors.
“Whether you insure in Ghana or offshore, the insurance language is the same. It is about risk,” he emphasized.
He admitted to the argument that purchasing local insurance policies will grow the National Insurance Industry and Ghana’s economy generally, but believes there is work to be done, to encourage the trading community to patronise local Insurance policies.
“They must assure the trading public that they are going to solidly stand by them so that they would also have that cushioning effect to go back to their suppliers to express the desire to let Ghana partake in the insurance component of the international trade,” he articulated.
Mr Joseph Agbaga who is also a former President of the Ghana Institute of Freight Forwarders (GIFF) agreed that, with the concept of the NIC setting a fixed proposed premium of 0.55% lower than the 0.875% on sea freight, and 1% on air freight used by customs during the calculation of duty for goods without insurance. He opined that that can serve as an incentive for importers to patronize local insurers.
“That would be a good way to market yourself to the local trading public for growth,” he expressed.
