Transport Ministry Urges Insurance Firms To Explain Premium Hikes

The Ministry of Transport has asked Insurance firms to come clean on the issue of premium hikes as they feel there’s something fishy about the increment in third-party premiums.

Contrary to what commercial drivers are saying, the ministry said they are only aware of the 300 percent increase which was proposed last year. The Progressive Commercial Drivers Union argued that there has been a 500 percent increase in the insurance premiums despite petitions to reduce it last year. They threatened to go on strike today if nothing is done to change the premium hikes.

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However, Deputy Transport Minister Joyce Bawa Mogtari, urged them to remain calm. She said that these increments in premiums were not made with the consent of the government.

We’ve gotten to the stage where people want to take unusual steps and the idea is that whatever happens, government must take the blame. What happens in the insurance environment really has nothing to do with government,” she said.

She has therefore demanded explanations from insurance firms about what transpired on the insurance premium issue. The Ghana Private Road Transport Union GPRTU) and the Ghana Road Transport Coordinating Council (GRTCC) had threatened go on strike at a press conference last Tuesday, if the increment was not reversed.

The Ghana Insurance Association (GIA) last year June proposed an 800 per cent increase in motor insurance premiums. But following protests from the transport unions, it was reduced to 300 per cent, which was to be implemented gradually in two stages. The commercial drivers however, alleged that the GIA was scheming to increase the third-party insurance to 500 per cent. Led by their chairman, Charles Danso, the drivers said that the Insurance Commission is not being fair to them especially when they are not benefiting from the insurance and other transport related charges.

We are giving National Insurance Commission (NIC), GIA and the Ministry of Transport two days within which to reduce the motor insurance premium rate to the agreed percentage of between 240-260 per cent ” he had said at the press conference.

Joyce Bawa has asked Insurance firms to come up with explanations and possible ways to avert the situation.

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