The Member of Parliament for Abuakwa South Constituency in the Eastern Region, Dr. Kingsley Agyeman, has called on President John Dramani Mahama to intervene and prevent the National Insurance Commission (NIC) from implementing a 10% increase in motor insurance rates.
In a letter signed by the Acting Commissioner of the NIC, Michael Andoh, the Commission announced its decision to implement the 10% increase—revised from an initial 15%—effective from 1st February 2025, following extensive deliberations and engagements with key stakeholders.
However, Dr. Agyeman has strongly opposed the increase, arguing that even the 10% hike would negatively impact the insurance industry and the motoring public.
“I appeal to His Excellency, President John Dramani Mahama, to listen. He must instruct the NIC to halt this increase so that further consultations can take place. Otherwise, it will cause untold hardship for the average Ghanaian. A 10% increase in compulsory motor insurance is no small matter. The ripple effect will hit the Ghanaian people the hardest,” he stated.
Dr. Agyeman also criticized the lack of sufficient consultation with stakeholders, claiming that the decision may exacerbate existing challenges in the insurance sector.
“As an industry player, I expected more consultation to assess the potential impact of this increment on general conditions of service,” he said.
He highlighted the ongoing struggles within the insurance industry, including high management and operational expenses, particularly in general insurance, and questioned whether the proposed hike would lead to adjustments in capped claims under existing insurance laws.
Dr. Agyeman further warned that the increase could backfire, as customers may opt for cheaper third-party policies, reducing overall revenue for the industry.
He pointed out the adverse effects the increase would have on vehicle owners and passengers, particularly the most vulnerable members of society, who would be most affected by rising costs.
The debate over the 10% increase continues, with commercial drivers voicing their concerns. James Ngah, a taxi driver at the University of Ghana taxi rank, shared his frustrations with JoyNews, highlighting the already high costs of spare parts, fuel, and competition from ride-hailing services.
“If this increment takes effect, our sales will drop further,” he said.
It remains uncertain whether the NIC will proceed with the proposed hike as scheduled.
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