Some provisions in the National Insurance Commission’s (NIC) new directives that place a ceiling on the amount of money accident victims should be paid as insurance claims will make life very difficult for victims.
The new directives which are the subject of a lawsuit proposed that adult accident victims who cannot provide proof of income in the prevailing year should be paid guaranteed monthly minimum wage for not more than 52 weeks to cover temporary disability.
Payslip, tax declaration as proof of income
The NIC directive describes proof of income as salary and wage earners with a payslip or self-employed with proof of income on the tax declaration for the past year prior to the accident.
Pensioners in danger
This category will include pensioners because they no longer work and therefore cannot provide payslips or tax declarations.
GH₵12.53 daily payment to adult victims who cannot provide proof of income
The National Daily Minimum Wage for 2021 is GH₵12.53 and therefore, the victim will receive a little over GH₵3,200 for the entire year to cover temporary disability.
50% of prevailing guaranteed monthly minimum wage to be paid to victims
Per the new directives, all accident victims who cannot provide the above should be paid 50% of the prevailing guaranteed monthly minimum wage and payment shall not exceed 52 weeks.
GH₵6.2 for victims without proof of income
It means that this category of accident victims will receive GH₵6.2 (GH₵6.265) daily which translates into GH₵1,628.9 for a year as temporary disability cover.
The new directives are expected to take effect on Wednesday, September 1, 2021.
Edgar Kwaku Wiredu, an insurance marketer who has sued the NIC at the Human Rights Division of an Accra High Court sees the directives as total shortchanging of accident victims.
Court asked to declare the new policy null and void
The suit, dated August 23, 2021, is asking the court to declare the NIC’s directives as null and void.
Act 1061 talks about formula, not limits
Act 1061 states that the NIC, in consultation with the insurance industry, shall by a directive prescribe a formula to compute compensation in respect of injury and deceased claims arising out of a motor accident.
Mr. Wiredu argued that the proposed directive on limits placed on motor injury and death claims (CAP 2021) flies in the face of the express letter and spirit of Act 1061, more particularly sections 197, 220, and 255.
According to him, implementation of the imposed limits by NIC would constitute a serious infringement on the rights of all citizens who may be involved in a motor accident as third parties.
This, he said, would be a complete misrepresentation and would lead to misapplication of the true intent of sections 220 and 225 of Act 1061 and other relevant statutes.
He is seeking an order of the court directing NIC to expunge and delete the directive on limits on motor injury and death claims from the list of directives issued by NIC to the insurance industry.
Mr. Wiredu also wants the court to place an injunction on NIC from implementing the said CAP 2021, as well as engaging in any consequential activities to promote the directive.
He is praying the court to order NIC to prescribe relevant formula as envisaged under Act 1061 to compute compensation in respect of injury and deceased claims arising out of a motor accident.
The insurance marketer is asking for costs, including lawyer’s fees, and any other reliefs as may seem fit to the court.
In addition to individual limits, the NIC has also directed aggregate limits per accident.
Deceased without spouse and dependents gets only GH₵5,000
Per the new regulations, a person who died in a motor accident is entitled to a fixed amount of GH₵5,000 as funeral expenses.
GH₵30,000 to be shared equally among spouses
The NIC has directed that GH₵30,000 be paid to spouses of dead motor accident victims, and if the victim has more than one spouse, the GH₵30,000 shall be divided equally among them.
GH₵25,000 to be shared equally among dependents
Per the new directives, GH₵25,000 shall be divided equally among all the dependents of the deceased.
Only GH₵5,000 without no spouse(s) and dependents
In effect, the family of a deceased motor accident victim shall receive only GH₵5,000 if the victim has no spouse(s) and dependents.
GH₵150,000 for private cars of individuals
For the aggregate limit for private cars of individuals, the NIC pegged the aggregate limit at GH₵150,000.
In the event that a private car involved in an accident is occupied by five passengers, including the driver, it means each passenger would be entitled to GH₵30,000, irrespective of the degree of injury to them.
GH₵150,000 for taxis
Similarly, taxis, which are passenger-carrying cars, also have GH₵150,000 aggregate limits.
5 Taxi passengers to get GH₵30,000 each
This also translates into GH₵30,000 for each passenger, irrespective of the degree of injury to them.
GH₵350,000 for minibusses
For minibusses carrying passengers, the NIC pegged the aggregate limit at GH₵350,000.
GH₵500,000 for 45 passenger buses
Passenger buses carrying 45 passengers have their aggregate limit at GH₵500,000.
Each passenger to get GH₵11,000
In the event of a passenger bus carrying 45 passengers, each person is entitled to over GH₵11,000, irrespective of the degree of injury to them.
GH₵700,000 for 65 passengers
For buses carrying passengers up to 65, the aggregate limit is GH₵700,000.
GH₵10,769 for each passenger
It means each person will be entitled to GH₵10,769, irrespective of the degree of injury to them.
GH₵350,000 for all others
For all others, the aggregate limit is GH₵350,000.
Victims who did not submit medical bills to get only GH₵1,000
Another worrying aspect of the directive is the proposal to pay not more than GH₵1,000 to victims who did not submit medical bills.