Road transporter owners have declared a nationwide strike next Monday to protest against a 500% increase in insurance premiums deemed outrageous.
At a press conference Tuesday, the Ghana Private Road Transport Union and the Ghana Road Transport Coordinating Council said their commercial drivers will not work if the decision is not reversed.
“We are…giving GIA., NIC. and the Ministry of Transport, two days within which to reduce the motor insurance premium rate to the agreed percentage of between 240%-260%”.
There was a transportation chaos in urban areas after drivers boycotted work in July 2015. Commercial drivers at Ashiaman, Kasoa, Tema even in Obuasi in the Ashanti Region resisted plans by the Driver and Vehicle Licensing Authority (DVLA) to insist on seat belts for all passengers in buses and taxis.
Insurance premiums; A 2015 controversy leaks into 2016
The latest contention for the drivers is third party insurance which is compulsory for all vehicle owners. The Compulsory Third Party Motor Insurance Act 1958 requires that drivers take insurance to protect and compensate passengers and pedestrians victimized in an accident.
In June 2015, the National Insurance Commission had attempted to shoot up premiums by 800%. The move sparked outrage from motorists.
After negotiations involving government, insurance premiums were pegged between 240% to 260%, the operators said.
It was also agreed the implementation of the increase will be gradual.
But the drivers say they were shocked to learn, third party insurance has skyrocketed to 500%. The transport owners say this a “needless act of bad faith”.
The road transport owners also are incensed that compensation package for paying a 500% premium is GHC2,000. They say even at the agreed 240-260% increase in premium, the compensation was pegged at GHC1,000.
For the drivers, GHC2,000 for 500% increase in premiums is a rip-off.
Insurance premiums have become a contentious issue for the industry regulator, National Insurance Commission. The Commission says premiums were last increase more than five years ago. They explain the marked depreciation in the Ghana Cedi is hurting their ability to pay claims.
Hence in June 2015, the NIC announced that annual premium for the least motor insurance policy — third party insurance – was to shot up from GH¢70 to GH¢471 for private cars. The same insurance for commercial taxis were priced at GH¢576 per annum.
Third party premium for mini-buses commonly called ‘Trotro’ has also been set at GHC586 with motorcycles required to pay GH¢256 for an insurance.
Clients resisted the move and drivers threatened to form their own insurance company. They have once again repeated their threat.
FULL PRESS STATEMENT
PRESS CONFERENCE BY ROAD TRANSPORT OPERATORS (GPRTU,GRTCC, GCTDA): STRIKE ACTION-MONDAY FEBRUARY 8,2016
Ladies and gentlemen of the media, we thank you for honouring our invitation to this press conference at short notice. We will make it brief.
We the undersigned, who are senior executives and representatives of road transport operators nationwide, have invited you to here to announce a nationwide strike action on Monday, February 8,2016.
This impending action has become necessary, following the many recent increases in road transport-related charges, and the failure of the relevant state institutions to listen to our cry for a reduction.
It will be recalled that in June, 2015, the Ghana Insurance Association (G.I.A.) attempted to impose an 8oo% increase in motor insurance premiums (Third party).
This was however fiercely resisted by the Ghana Private Roads Transport Union (GPRTU), Ghana Committed Drivers’ Association (GCTDA) and GRTCC, leading to a reduction of the premium to 400% increase, which we again rejected.
Following continued negotiations between the Ministry of Transport, Road Transport Operators and GIA. and NIC, a mutually agreed incremental rate of between 240%-260% was arrived at.
Ladies and gentlemen of the media, instead of applying the agreed incremental rate of between 240%-260%, the GIA has this year, rather increased the 400% premium rate, to 500%!
This, ladies and gentlemen, is not good, and is an act in bad faith by the GIA.
We are by this press conference, giving G.I.A., N.I.C. and the Ministry of Transport, two days within which to reduce the motor insurance premium rate to the agreed percentage of between 240%-260%
Failure to do this will result in the call to all members of GPRTU, GCTDA, and GRTCC nationwide to position themselves for a total strike action on Monday, February 8, 2016 to register our anger at what we consider a needless act of bad faith by the GIA, and an act of insensitivity by the NIC and Ministry of Transport.
Ladies and gentlemen of the media, thank you.
CHARLES DANSO(CHAI RMAN-GCTDA)-0264233929
OMAR BALE(TIPPER CHAIR-TEMA/SAKUMONO/ASHIAMAN)-0243217121