Gov’t enjoined to sign the African Trade Insurance initiative

The Managing Director of Activa International Insurance Company, Solomon Lartey, has prompted Government to sign onto the African Trade Insurance (ATI) initiative, a pan-African institution that provides political risk insurance to companies, investors, and lenders interested in doing business in Africa.

The ATI offers specific insurance products designed to promote and protect investments in Africa and offers a full suite of products to protect against political risks, which covers expropriation of assets, currency inconvertibility or transfer restrictions, and trade embargoes.

ATI also gives protection against non-payment risks, wrongful calls on your performance bond and damage to your property or loss of revenue from business interruption due to politically motivated violence or terrorism and sabotage events and surety bonds and trade credit insurances.

General Manager, Operations at SIC, Faris Elias Attrickie, also called on Government to help generate strong insurance companies by significantly reviewing the minimum capital requirement and encourage the smaller ones who cannot manage and handle huge premiums and risks due to lack of financial capacity to merge. This will reduce the undercutting of premiums which consequently reduce Insurance penetration.

Lartey said that he believes the National Insurance Commission would increase minimum Capital requirement for Insurance companies in the near future.

“however, this must be done in a graduated format, such that insurance companies which desire to write risks with minimum exposures which would not require high capital outlays would have lower capital requirements compared to those exposed to large corporate risks which should be required to set aside high capital. Thus insurance companies would fall into different licensing categories depending on their appetite and the nature of risks they intend to carry,” he added.