The new insurance law, passed by Parliament on Monday, will ensure that the insurance industry is regulated in accordance with international standards to make it globally competitive, says a parliamentary report on the bill.

The report by Parliament’s Finance Committee said the law seeks to increase the insurance penetration rate in Ghana by developing a stringent regulatory framework to protect customers and prevent the collapse of the industry.

The law replaces the Insurance Act 2006, which until now has governed the industry.

Dr. Mark Assibey-Yeboah, Chairman of the Finance Committee, said for any country to achieve a significant level of economic development, there is the need for it to develop a vibrant and adequately capitalised insurance industry.

The law incorporates provisions that enhance the capacity of insurance companies to comply with international best practices, and also introduces risk-based supervisory requirements.

Over 30 percent of Ghanaians currently have one form of insurance or another, excluding pensions and health insurance.

The new law reflects government’s efforts to grow the industry by strengthening corporate governance and increasing insurance accessibility for the poor and informally employed.