She said the framework which was issued in December 2014 required insurance companies to meet new minimum capital requirements, new Capital Adequacy Ratios and as well use the prescribed methodologies to calculate their Technical Provisions.

Ms Bawa, speaking at the launch of RegencyNem Insurance Ghana Limited, said even though many companies have fully met the requirements, only Regency Nem did that so through a merger.

She said apart from the capitalization, the NIC has also required insurance companies to implement effective corporate governance and risk management strategies to improve efficiency and profitability.

The Commissioner said the corporate governance and the risk management framework required insurance companies to establish control functions such as internal audit, risk management and compliance to improve risk mitigation.

Ms Bawa said the Ghanaian insurance industry as at December 2015 recorded a gross premium of GHC 1.5 billion and total assets of over GHC 3 billion. She said even though this represents a significant growth over previous years’ figures; is still insignificant in terms of contribution to Ghana’s Gross Domestic Product.

The Commissioner said the low insurance penetration could be attributed to the challenges that inhabit operational efficiency, profitability and financial soundness of the industry, adding that “chief among such challenges is the high number of very small companies”.

Mr Edward Pianim, Board Chairman of RegencyNem Insurance, said Regency Alliance Insurance Limited and NEM Insurance Ghana, being the first local insurance companies to merge in Ghana, marked the beginning of a new strategic relationship which will be of benefits to its stakeholders. He said both companies are subsidiaries of international insurance companies and entered the market in 2008 and 2009, respectively to contribute to the advisory service in insurance and other insurance activities.

Mr Pianim said these objectives have been largely achieved because they have both operated throughout the following years with efficiency and profitability. The Board Chairman said when they were operating on the Ghanaian market the minimum capital requirement was $ 1 million. However, with the introduction of risk based supervision by NIC and with new minimum capital of GHC15 million cedis, there was a need to change their direction to be able to pursue their purpose and also have a position in the Ghanaian market.

Mr Bode Oseni, Managing Director for RegencyNem Insurance Ghana Limited, in his welcome address, said the combination of resources have strengthened them, and were setting out to deliver new standards for excellence in the industry, adding that “we are more than ever committed to provide superior service experience to delight its numerous clients".

The Managing Director on behalf of management expressed gratitude to NIC for its encouragement and provisions of enabling environment for the merger to take place, and also assured all stakeholders of its commitment to build a strong insurance company.