The Acting Commissioner of Insurance, Mr Michael K. Andoh, has advised players in the insurance industry to desist from “premium undercutting” to help sustain the insurance industry.
Premium undercutting is defined as the practice where an insurance company offers clients “unrealistically low premiums” in order to gain a competitive advantage.
According to him, premium undercutting remained a challenge to the insurance industry and denied it of the necessary funds to develop.
Mr Andoh gave the advice in Accra yesterday during a day’s seminar organised by the West Africa Chartered Property Underwriter (CPCU) Society Chapter.
The West Africa CPCU Society Chapter, an affiliate of The Institutes’ CPCU Society, an international organisation with the headquarters in USA, has the objective to promote ethical standards in insurance.
Mr Andoh, who chaired the programme, said premium undercutting was against the ethics and standards of the insurance industry.
Though the Acting Commissioner of Insurance could not give figures on how much undercutting costs the insurance industry, he said it was one of the reasons some of the insurance companies recorded losses.
The Acting Commissioner said the seminar would discuss technology, new trends, challenges and opportunities in the insurance industry.
He said the low insurance penetration in the country was as a result of the low adoption of technology and the failure on the part of some insurance practitioners to go by the standards of the profession.
The Global President of CPCU Society, Traci Adedeji, in her remarks, said the CPCU Society was established 80 years ago to promote professionalism and ethical standards in the insurance industry.
She said the Ghana chapter was established in October last year to promote the insurance industry in the country.
Ms Adedeji entreated practitioners in the insurance industry to build trust, pointing out that trust was crucial for development of the insurance industry.
She entreated insurance practitioners to put the needs of the customers above their interest.
The Senior Director, Analyst Gartner Inc, USA, Rajesh Narayan, in his remarks, urged players in the insurance industry to embrace technology.
He said technology was not to displace them of their jobs, but to aid them to become efficient and reach more customers.
Justice Peprah Agyei, West Africa CPCU Society Chapter Interim President, in his address, said the association was to elevate insurance practice in the sub-region.
He said the association was also to facilitate network and promote innovation in the insurance industry.
BY KINGSLEY ASARE