Financial Literacy: Key to Boosting Insurance Penetration in Ghana – Insights from Sanlam Allianz MD Tawiah Ben-Ahmed

Low insurance penetration in Ghana, hovering below 3%, limits economic resilience. Discover how enhancing financial literacy can transform insurance coverage uptake, as emphasized by Tawiah Ben-Ahmed, CEO and Managing Director of Sanlam Allianz Life Insurance Ghana.

Introduction

In a recent appearance on the Joy Super Morning Show on November 3, 2025, Tawiah Ben-Ahmed, the Chief Executive Officer and Managing Director of Sanlam Allianz Life Insurance Ghana, highlighted financial literacy as the cornerstone for increasing insurance penetration in Ghana. With the nation’s insurance penetration rate remaining under 3%—measured as insurance premiums relative to gross domestic product (GDP)—this call underscores a critical barrier to broader financial protection.

Financial literacy, defined as the ability to understand and effectively apply financial principles including budgeting, saving, investing, and risk management, plays a pivotal role in demystifying insurance. Ben-Ahmed stressed that many Ghanaians, particularly in the informal sector, hesitate to adopt insurance due to misconceptions and limited knowledge. This article breaks down his insights, offering a pedagogical guide to boosting insurance coverage penetration through education.

Understanding Insurance Penetration

Insurance penetration refers to the percentage of a population covered by insurance policies or the ratio of premiums to GDP. In Ghana, this metric stands below 3%, far below global averages of around 7%. Life insurance, a focus for Sanlam Allianz, protects against life’s uncertainties like death or disability, acting as a financial buffer.

Analysis

Tawiah Ben-Ahmed’s advocacy reveals deep-rooted challenges in Ghana’s insurance landscape. He explained that insurance is not merely a cost but a safeguard for livelihoods and businesses. This perspective shifts the narrative from viewing premiums as expenses to investments in security.

Misconceptions in the Informal Sector

Ghana’s economy relies heavily on the informal sector, where over 80% of the workforce operates without formal contracts. Here, limited financial education fosters myths, such as insurance being only for the wealthy or claims being hard to access. Ben-Ahmed noted that despite innovative products from insurers—like micro-insurance tailored for low-income earners—uptake remains low due to these barriers.

Role of Stakeholders

Ben-Ahmed called for collective action: insurers must simplify products, regulators enforce standards, policymakers integrate literacy into curricula, and media amplify awareness. This multi-stakeholder approach aligns with global best practices, where countries like South Africa have raised penetration through targeted campaigns.

Summary

Tawiah Ben-Ahmed’s statements on the Joy Super Morning Show encapsulate a strategic vision: prioritize financial literacy to elevate Ghana’s insurance penetration from under 3%. By addressing knowledge gaps, simplifying processes, and building trust, stakeholders can foster greater adoption of insurance coverage, enhancing national economic resilience and social safety nets.

Key Points

Practical Advice

To harness financial literacy for insurance penetration, individuals, businesses, and institutions can take actionable steps. This section provides pedagogical guidance grounded in Ben-Ahmed’s insights.

For Individuals

Begin with self-education: Use free resources like the Bank of Ghana’s financial literacy portal or apps from insurers such as Sanlam Allianz. Assess personal risks—health, life, property—and match them to policies. Start small with term life insurance, which offers high coverage at low premiums. Track claims processes online to build confidence.

For Insurers and Businesses

Develop micro-insurance products with premiums as low as GHS 5 weekly. Partner with mobile money platforms like MTN MoMo for seamless payments. Launch community workshops explaining concepts like “sum assured” versus “premiums.” Sanlam Allianz exemplifies this with tailored life products for informal workers.

For Policymakers and Educators

Integrate financial education into school curricula, as recommended by the National Insurance Commission (NIC). Subsidize literacy programs in rural areas. Regulators can mandate plain-language policy documents to reduce complexity.

Points of Caution

While advancing financial literacy promises growth in insurance coverage penetration, pitfalls exist. Beware of overpromising: Insurance does not cover all risks, such as pandemics unless specified. Mis-selling by agents erodes trust—always verify licenses via the NIC website.

Common Misconceptions

Avoid believing insurance is a “get-rich-quick” scheme; it’s protection, not investment (though some policies combine both). In Ghana’s context, informal workers should note exclusions for pre-existing conditions. Demand transparency on renewal fees and cancellation policies to prevent surprises.

Economic Realities

Low penetration reflects affordability issues amid inflation. Prioritize needs-based coverage over comprehensive plans initially.

Comparison

Ghana’s insurance penetration below 3% contrasts sharply with regional and global benchmarks, highlighting the urgency of financial literacy initiatives.

Ghana vs. Africa

South Africa leads Africa at over 14% penetration, driven by mandatory coverage and robust education. Nigeria hovers at 0.5%, similar to Ghana, but fintech integrations are accelerating growth.

Ghana vs. Global Standards

Worldwide, developed nations like the UK exceed 10%, while emerging markets average 4-5%. Kenya’s 2.5% is comparable, but its micro-insurance boom via mobile tech offers lessons—penetration rose 20% post-literacy drives.

Ben-Ahmed’s focus on education mirrors successes in Rwanda, where penetration doubled after national campaigns.

Legal Implications

In Ghana, the Insurance Act 2021 (Act 1061) mandates fair practices, requiring insurers to disclose terms clearly. Regulators like the NIC oversee penetration goals and literacy programs. Non-compliance risks fines, emphasizing Ben-Ahmed’s call for simplified processes. Consumers have rights under the Act to fair claims settlement, fostering trust essential for uptake. No direct legal penalties for low literacy exist, but policymakers must align with Sustainable Development Goal 8 on decent work and economic growth.

Conclusion

Tawiah Ben-Ahmed’s advocacy positions financial literacy as the linchpin for elevating Ghana’s insurance penetration. By demystifying insurance, simplifying access, and uniting stakeholders, Ghana can mirror global successes, fortifying its economy against uncertainties. Individuals armed with knowledge will embrace policies as buffers, paving the way for resilient livelihoods. Act now: Educate, insure, prosper.

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