Illegal insurance broker busted

Officials of the Special Investigation Unit (SIU) of the National Insurance Commission (NIC) have uncovered the operations of a firm in the act of offering insurance broking services, under the name Zeta Insurance Brokers, without a licence.

According to the Commissioner of Insurance - Justice Yaw Ofori, Zeta Insurance Brokers has been in operation for the past five years from the headquarters of the Apostolic Church of Ghana, with the connivance of a direct underwriting company in the country.  

The company was busted in February 2019 when it came to the Commission’s attention that some unscrupulous people were operating under the name of Zeta Insurance Brokers - purportedly offering insurance broking services to unsuspecting individuals and companies, mainly in the Greater-Accra Region.

This act is against the Insurance Act, 2006, Act 724, which prohibits an unlicenced insurance broker from carrying out insurance broking services with the public. In line with this, the NIC has moved in swiftly and advised the general public to desist from engaging the services of this firm for the purpose of insurance broking services.

The NIC has also reiterated the fact that under the Insurance Act, 2006, Act 724, it is an offence for an underwriting company to engage in the business of insurance with an unlicenced intermediary.

In line with this, the Commission is therefore at an advanced stage of sanctioning the aberrant underwriting company according to Section 52 of the Insurance Act 724, which spells out administrative sanctions against this such an underwriting company. 

Section 52 of the Act prohibits payment of commission to an unlicenced insurance intermediary, as this will cause an insurer to contravene sub-section (1) and hence be liable to pay the Commission a pecuniary penalty as stated in the first schedule.

Already, the key actors behind this illegal operation have been interrogated by the Ghana Police Service and accordingly charged with appropriate offences. More importantly, too, it is imperative to know that the Insurance Act 2006 Act 724 endows the Commission with powers to sanction erring companies in order to ensure sanity and boost public confidence in the business of insurance.

The National Insurance Commission says it is committed to executing its mandate to the fullest in order to protect the interest of the insuring public, as well as promote best business practices. In this regard, the Commission has advised the insuring public to always check with the Commission on the status of any entity offering or purporting to offer insurance services before engaging them.