Climate related risks and its implications on the insurance industry in Ghana

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AUGUST, 2015.
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The effect of Climate related risks on the insurance industry has long being acknowledged. The purpose of the research was to examine the potential effects of climate related risks on the insurance industry and to identify risk management techniques and mitigation measures implemented by the industry to contain the potential implications of Climate related risks. Questionnaires and interviews, tables, pie charts and graphs were used to gather and analyze data respectively. The study revealed that increases in underwriting losses on property insurance, withdrawal of cover from certain geographical areas, Premium increases, insolvencies, International reinsurance cost/capacity are some of the identified implications of Climate related risks. These potential occurrences consequently affect claims outlays, difficulty in obtaining co-insurance, difficulty in obtaining reinsurance, profitability and solvency as well as capacity and ability to absorb large risks. The research further revealed that compulsory risk survey, premium loading, accepting cover but imposing deductibles, warranties and other policy conditions are some of the risk management measures adopted by the insurance industry.
Thesis submitted to the department of Accounting and Finance, Kwame Nkrumah University of Science and Technology In partial fulfillment of the requirement for the degree of Master of Business Administration (Finance Option),