An Insurance Expert, Mr Edgar Wiredu, has called for a broad-based campaign to educate the general public on the new Moto Insurance Database (MID) system. The National Insurance Commission (NIC) has introduced the system to fish out fake insurance stickers.
According to him, while the idea behind the new system was good, majority of the people are not aware or well informed about how it works.
“The database [Motor Insurance Database] is okay. I mean it’s good for people to know that the car they are sitting in is properly insured and that is a good thing. But the problem we are having now is that are the general public aware of this issue?”
“And so, there is the need for a broad education on the new system”, he added.
Mr Wiredu said this during a telephone conversation with Ghanatalkbusiness.com on Wednesday 5th February..
Moto Insurance Database (MID) System
The Commissioner of the NIC, Mr Justice Yaw Ofori, is reported to have disclosed that insurance companies in the country were losing close to GH¢390 million of their gross revenue annually to fraudsters. These fraudsters issue fake insurance stickers to unsuspecting vehicle owners.
To curb this phenomenon, the NIC, in January 20 this year, rolled out an electronic system known as the “Motor Insurance Database”.
“The history behind the introduction of the MID is quite simple. We realised we have a lot of fake insurance stickers on the market. The public couldn’t tell which stickers were genuine, the police couldn’t tell so we needed to find a solution”.
“We have instances where people are claiming to have bought a policy from an insurance company and the company is also denying that they sold the policy”
“In order to solve this, the motor insurance policies must go digital and by doing so, we decided to get a software that will help us to instantly issue electronic stickers. And instantly receive confirmation that the policy you have purchased is genuine, giving you details of the policy”, Mr Ofori is quoted to have said this to the Daily Graphic.
Help of the police
Mr Ofori was, again, reported to have said that his outfit will collaborate with the Motor Traffic and Transport Unit (MTTU) of the Ghana Police Service to enforce the new system. Hence they will provide mobile phones to the police to scan the QR codes embedded in the new stickers. This will verify whether a vehicle has a valid insurance or not.
““We will mount roadblocks and check insurances with the police. We ask the public to also be on the lookout for people who are selling insurance using the old stickers. Every insurance that you get should be an electronic sticker and you should get a confirmation when you purchase it,” he emphasized.
But on this issue, Mr Wiredu, in the interview, opined that it was too early for the NIC to start mounting roadblocks with the help of the MTTU to check for insurance.
He said the the best thing to do was for the insurance commission to wait for a while to allow the new system to run for at least a year. By which time all the cars in the system would have the barcoded insurance stickers, before making those pronouncements.
Such pronouncements, he averred, could create a problem for many vehicle owners and drivers as there were many cars in the system which still use the old insurance stickers. Which he doubt whether the MID system could detect if they are genuine or fake.
“The thing didn’t even take effect from 1st January, it took effect from 20th January, so it means that those who renewed their stickers from 1st January got the old ones. So somewhere along the line, if you are not careful you will create a problem for such people”, he explained.
GH¢390 revenue loses
On the specific issue of the GH¢390 million annual revenue lose to the insurance companies, the Insurance Expert, stated that NIC should not be too much bothered about the lose of money to the firms.
Rather, he said, the emphasis ought to be on the innocent people who are likely to suffer for using cars that have fake insurance stickers.
“They should rather be concerned about people who are likely to suffer some mishaps and the difficulty in they being compensated, because at the end of the day, compensation is going to be a problem”.
Author: Salifu B.B. Moro