In 2023, Ghana’s insurance industry achieved remarkable growth, with its total investment assets expanding by 22%, according to the Bank of Ghana’s Financial Stability Review report. The sector’s assets rose to GH₵10.5 billion, up from GH₵8.6 billion in 2022, despite facing challenges such as the COVID-19 pandemic and the Domestic Debt Exchange Programme (DDEP).

The life insurance segment was a key contributor to this growth, reaching GH₵7.0 billion in investment assets by the end of 2023, while the non-life sector held GH₵3.5 billion. Both sectors continued to favor fixed-income assets in their investment portfolios.

However, the share of government securities in these portfolios has decreased significantly, likely due to the effects of the DDEP. For the non-life insurance sector, government securities allocation fell by 13%, from 38% in 2022 to 27% in 2023. Fixed deposits now comprise 23% of this sector’s investments, while listed securities and investment properties make up 27% and 19%, respectively.

Similarly, the life insurance sector saw a 9% drop in government securities, from 49% of its portfolio in 2022 to 40% in 2023. To balance this reduction, the sector increased investments in other asset classes, such as properties (now 23% of the portfolio) and fixed deposits, which rose by 8 percentage points to 21%.

These portfolio shifts highlight a strategic move towards diversification, helping the sector adapt to evolving market conditions. This resilience and focus on long-term stability underscore the industry’s commitment to safeguarding policyholder interests and maintaining financial robustness.

Source:TheDotNews