Director of Research, Planning, Monitoring and Evaluation at the National Pensions Regulatory Authority (NPRA), Amartey Vondee has called on insurance and pension scheme operators to simply the language of their trade in order to attract the millions of informal sector workers who shy away from such schemes.
Speaking at the launch of a digital-based pensions product launched by Ecobank Ghana and People’s Pension Trust, Mr. Vondee noted that industry players have a lot to do to boost public confidence in insurance products and pension scheme, one of which is to simply the language and the process for the average Ghana.
He noted the for the greater part, people find the language used in communicating insurance and pension very complex, saying that additional, the also find the onboarding and claims processes equally complex.
Another factor that put people off from insurance and pensions scheme is the deliberate mis-selling by agents, whose often have profits as their motivation so “they will do anything and everything to get people sign on only for the customers to find out later that the agent was not completely honest with them.”
Mr. Vondee, who said he had worked in the insurance industry before, told the story of how an agent lied to a customer that with his insurance policy he could even secure a visa easily, so the customer actually included his policy in a visa application and it was thrown out.
He therefore charged industry players to take a serious view of agent training and ensure that agents are playing by the ethics of the profession and not mis-selling policy, because that practice is counterproductive to the industry.
He lauded Ecobank for its commitment at partnering insurance and pensions industry players to create innovative products to capture more informal sector workers into the pensions community.
He recalled Ecobank’s recent partnership with Enterprise Trustees in a widely-lauded Pensions Back Mortgage scheme to enable Tier 2 and Tier 3 pensions contributors to be able to buy and own homes using their pensions contribution as a collateral of sorts.
Mr. Vondee urged more of such partnerships so that the greater majority of workers in Ghana who do not have any pensions, would be provided for.
According to him, the Ghana Living Standards Survey (GLSS) indicates that 71 per cent of the 11.216 million workers in Ghana are in the informal sector and greater majority of them do not have any pension cover.
He said as of December 2020, Ghana’s total pension asset was GHC33.4 billion, out of which SSNIT held only GHC11.3 billion, with private pension schemes accounting for GHC22.9 billion.
“Clearly the private pension scheme operators have taken the center stage in the industry and they are proving that people can count on them to create value and a secured future for them.
“I would therefore like to take the opportunity to encourage informal sector workers to take advantage of the opportunities and convenience provided by partnerships like the one Ecobank and People’s Pension have and save towards their own future.
“Personal Pension Schemes are creating value for lots of people around the world and even in this country – the little you contribute today, by the power of compound interest, you will retire happy even without depending on SSNIT,” he said.