The National Insurance Commission (NIC) of Ghana has granted sandbox innovation licenses to five Insurtechs operating in the country.
The sandbox license will allow the insurtech firms to roll out innovative products in a pilot phase for a period of one year, after which the commission will review the performance of the licensed products and decide if to issue a full license for the same.
Insurance technology (Insurtech) refers to the use of innovative technology such as artificial intelligence, big data analytics, machine learning, blockchain and other emerging technologies to improve and automate traditional insurance processes.
Speaking at the Tech and Innovation Insurance Forum, the acting Commissioner of Insurance Mr. Michael Kofi Andoh empharsized the need for innovation in the insurance sector. He explained that the adoption technology is expected to deepen insurance penetration in the country.
“As a forward looking insurance regulator, the NIC is committed to enable market players leverage innovation and technology for market development.”
“Our modern Insurance Act supports innovation, and we anticipate that the market will seize this opportunity to expand access to insurance, bridge the protection gap, and safeguard policyholder interests.” noted Andoh.
The regulatory sandbox project was supported by FSD Africa’s Bimalab programme. The programme seeks to enhance innovation in the insurance industry across Africa. Now operating in 16 African countries, it has so far assisted with the establishment of 100 insurtechs, 75 new projects and raised over US$ 35M in capital for various insurtechs firms.
On his part, Principal, Innovation for Resilience at FSD Africa Elias Omondi hailed Ghana’s Insurance regulator and industry for taking bold decisions towards the adoption of innovation.
“Insurance is a great way to build resilience for our businesses and lives. Yet here in Africa insurance services remain a preserve of just but a few often due to low coverage and prohibitive costs. Innovations such as insurtechs are dealing with these challenges by developing exciting innovative products geared towards expanding coverage to the underserved. A supportive regulatory regime is key for this to happen, and we laud NIC for being strongly pro-innovation”.
Among the insurtechs issued with the regulatory sandbox licenses to pilot their innovations are Figtech, Moovon Insure, Hollard Insurance and ETAP, Trade Guarantee Limited (TGL), and Red Pear. All five companies are offering diverse innovative solutions which is expected to improve coverage.
The insurance sector in Ghana comprises of 26 non-life companies, 18 life companies, 3 re-insurance companies, 113 insurance brokers and 5000 agents across the country. In 2022 total assets were GH¢17 billion at the end of 2023 with life contributing GH¢8.5 billion, non-life bringing in GH¢6.6 billion, reinsurance; GH¢1.4 billion, whiles intermediaries contributed GH¢0.5billion
