Calle Schlettwein, Finance Minister, has refused to withdraw his draft regarding the leving of 18% on the premiums issued. This amount would be deducted from each insurance policy issued or renewed by the Namibian insurers.
The sums collected would be received by the state-owned reinsurer Namibia National Reinsurance Corporation (NamibRe). It is in fact a form of legal cession for the benefit of the State which also undertakes to pay a share of 18% on each claim. In addition, the payment of claims requires the prior approval of NamibRe. Along with this legal cession on direct insurance policies, Calle Schlettwein is willing to impose a 20% legal cession on reinsurance treaties.
Amounts ceded to foreign reinsurers are currently close to 2 billion NAD (146 million USD). Local insurers are ready to accept the legal cession on reinsurance treaties but unanimously reject the idea of paying the State 18% of each underwritten policy. For insurers, the State does not have the financial and human capacity to manage insurance policies.
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