Mr Touray, also the president of the American Chamber of Commerce and Industry of The Gambia (AmCham), said even though the country’s insurance industry is relatively doing well, it can do much better if certain critical reforms are undertaken in the industry.
Presenting a paper on ‘the impact of the proposed reform in the insurance industry on the economic development of The Gambia’, he said if the Gambian economy is to be transformed in line with the wishes of the Gambian leader, President Yahya Jammeh, the transformation should start with the economic actors and one such key actor is the insurance industry.
Touray was presenting the paper at a forum organised by the Insurance Association of The Gambia (IAG) as part of events marking the Insurance Awareness Week 2015.The awareness week, which began on Tuesday, consists of a series of activities geared toward solidifying the position of the country’s fledgling insurance industry.
Policy reforms needed
The development economist said the insurance industry needs certain policy reforms such mandatory local marine insurance in line with the recommendation of United Nations Conference on Trade and Development (UNCTAD).UNCTAD has recommended to all governments, globally, more than 25 years ago, to legislate marine insurance and make it compulsory, locally.
The majority of countries in the world have effected that recommendation, except a few countries like The Gambia, according to Mr Touray.
He said another reform needed in the insurance industry is for the government, through the Central Bank of The Gambia (CBG), to review the Third Party Insurance Policy.
Presently, The Gambia has the lowest tariff for motor insurance in West Africa; yet most of the claims that the industry is struggling with are claims that emanate from motor insurance.Therefore, there is a need to review and have a standard tariff for motor insurance as the costs of spare parts are skyrocketing and third party injury and death claims are high.
Furthermore, the AmCham president emphasized the need to legislate the non-bank financial sector.He said already studies have been done in that regard, and a draft Act has been prepared, now waiting to be tabled at the National Assembly for approval which will pave a way for the establishment of mortgage companies, leasing companies, and venture capital companies in The Gambia.
Besides, Mr Touray said there is need for an autonomous insurance commission in The Gambia, so that the country’s insurance industry can be on the same wavelength as other industries globally.
However, he said the Central Bank, the regulator of the financial industry including the insurance industry, has been doing a tremendous job in terms of regulating the insurance industry.
But, Mr Touray went on, in terms of best practice and what obtains in the sub-region and around the world, there is need for an autonomous commission to regulate the affairs of the insurance industry.
Micro insurance
The AmCham president also called on the chief executive officers of insurance companies to look at the possibility of introducing micro insurance.
“I take the cue from what has been happening in the banking sector.If you look at the statistics, only 15 to 20% of Gambia’s population has a bank account, prior to the introduction of micro finance by the Central Bank,” he said.
Now that micro finance is introduced, a significant number of Gambians have bank accounts either with the mainstream banks or the micro-finance institutions.
In the same vein, Mr Touray said by introducing micro insurance, the insurance companies will be providing insurance to the uninsured and underinsured, which will lead to a significant increment in insurance policyholders in The Gambia.
According to statistics from the Central Bank, as quoted by Mr Touray, the Gambian economy in 2014 had contracted by 5 per cent.
He said to avoid such scenarios from happening, and to significantly expand the country’s economy, this could be done by opening avenues within the insurance landscape.
Ben Birch Mensah, managing director of Enterprise Life Assurance Company Limited, said there has been very little awareness, very little understanding among the majority of the people about insurance and insurance policies in The Gambia.
This explains why the insurance association has been embarking on the Insurance Awareness Week, during which a series of activities are staged all geared toward projecting the importance of insurance to individuals and the national economy as a whole, he said.
The Insurance Awareness Week started on Tuesday with a march-past which started at Westfield and terminated at the head office of Royal Insurance Company on Kairaba Avenue where statements were delivered by various insurance stakeholders.
Thursday will be the annual general meeting of the IAG, during which members will discuss the association’s achievements and challenges over the previous year and chart a new way forward.
The IAG co-operative credit union will hold its annual general meeting on Friday, and Saturday, the last day of the weeklong event, is slated for the association’s picnic to be attended by insurance companies’ senior management officials and staff.
