NIC to cap injury, death compensations

National Insurance Commission (NIC) has stated that it is committed to provide a cap for injury and death compensations for third parties before the end of the year. 

This, according to the NIC, means in the event of a vehicular accident where injuries are sustained or a life is lost, insurance companies which are liable would have to pay claims to the effect – having established that the vehicle has insurance cover in accordance with a policy guide spelling out so much to be paid for what level of incapacitation or deformity.

This decision follows a call made by the Ghana Insurance Brokers’ Association (GIBA) at a Cocktail event organised by the Institute of Insurance Ghana (IIG) to outdoor its new image as Chartered Institute of Insurance Ghana (CIIG).


President of GIBA, Nathan Adu, in a speech said “In the last CEOs meeting with the Commissioner, he brought out some issues, one of which borders on capping of bodily injuries in this country and since CIIG is championing the issues of ethics, I will urge them to add standards to it so that if they could come out and spearhead this fight to get the insurance industry to cap bodily injury claims in this country, I think would be a further in the cap of the industry.”


Deputy Commissioner of Insurance, Michael Kofi Andoh, in an interaction with the media described the policy as “still work-in-progress” and his outfit is looking at implementing same before the end of the year.


“We have been working on that for quite some time. Indeed I think there is a provision in the Insurance Act that requires us to provide caps for those liabilities. There is a document that we are working on and we need to do the appropriate consultations and discussions to make sure that the document are workable. It needs to be passed into law because this would be used in the law courts as well as the insurance halls to become the norm.” Mr Andoh said.

He was hopeful that the cap would be out before the end of the year.

For motor third-party policy, there is a cap of GHC2,000 (that is, Third Party Property Damage Limit) an amount payable to a third party for damage to vehicle or motor. This limit, however, can be increased depending on the policyholder’s preparedness to pay a higher premium.

This means that, in an incident of a collision between Car A and Car B for instance, assuming the circumstance of loss indicates that car A is the cause of the accident, it means owner of Car A and his or her insurance company are liable, hence must pay a TPPD claim up to a limit of GHC2,000 to the owner of car B.

This cap serves as a guide for all insurance companies in Ghana for settlement of third party motor insurance claims.

Some industry players believe that it is impossible to quantify incapacitation and deformity of the human body. In other words, one cannot attach a fixed payment amount to, for instance, loss of an arm, leg, ear etc. as a result of an accident.

Some also believe that insurance premiums are woefully inadequate to merit payment of exorbitant injury and death claims.


If this is implemented, it means that insurance companies can now have a guide, as is the case of the Third Party Property Damage compensation, how much is payable in the case of injuries and deaths.

It can reduce the cases of non-payment of injury or death claims by insurance companies to injured claimants or deceased estate administrators.



…with Kofi Owusu Tawiah

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