Small Business Insurance

Insurance is a financial protection against loss or harm. Assurance deals with life, such as life policy whiles insurance deals with non-life matters such as fire, burglary and so on. It is a pool of funds created by a large group of people who face similar risks to compensate for the losses of the unfortunate few who suffer such risks through the payment of premiums. Insurance products are offered by insurance companies to provide financial protection for its customers. There are two types of insurance products namely, personal and commercial lines. These products can also be described as mechanisms used by consumers for hedging the future contingent risks related with life, health and non-life general business risks. The purpose of insurance is to transfer a risk that you can afford through the payment of a premium with no guarantee of its return to cover a risk you cannot afford. Apart from the business’ legal representative and accountant, it will require the services of an insurance agent when deciding to have an insurance policy.


The usefulness of insurance cannot be understated in small businesses. Small businesses are exposed to so many risks because the business premise for operation may not belong to the owners of the business. Most of these office premises are on long term lease terms. Power fluctuations, unethical behavior and negligence on the part of employees maybe lead to huge losses. The recent spate of fire outbreaks at Agbogbloshie market, Makola Market and many more in Ghana is attributed to power fluctuations. Victims then have to wander about startup capital, settling creditors and the emotional trauma of losses suffered. Insurance therefore presents prudent measures to curb the above risks. Depending on the type and operations of one's business, there are premiums to pay to purchase unique insurance packages.

Reasons why you should insure

What lies ahead is something no one can predict but if you leave your business to fate, you become a victim of chance. Every serious business should be adequately prepared for future uncertainties and put in place measures to minimize the effects in the event it occurs. Insuring your business helps you to do that. Benefits from insuring helps the policy holder or beneficiary in combating with the losses or hazards associated with their businesses.
Dangers of staying uninsured

o You will be out of business if the emergency that can be solved with insurance occurs

o You will have to bear losses by yourself

o You will have to buy new vehicles or build new warehouses again in order to remain in business

o Your creditors and suppliers would chase you for their money despite their awareness of your predicament.

You can avoid the above dangers by choosing to insure your business today.

Commercial line products including motor insurance, fire and allied perils, burglary, project insurance provide compensation for losses suffered. This can be a strategic stance to curb uncertainties and sustain businesses.

PROPERTY INSURANCE

Property insurance should include a broad form of coverage to protect you from a wide variety of losses that are property related. Your insurance should include buildings. Insurance coverage would be required here if you own the building your business occupies.

OTHER ASSETS

Business property includes your tables, desks, chairs and equipment. Other office items that are used for administrative purposes should not be excluded. Examples include, room divider you add, or a display case, or a custom built counter that forms part of reception area for your clients.
Business vehicles and business warehouse
Keep in mind that an all-risk policy can be structured to cover all of your equipment, including computer hardware and software, plus your valuable records. A properly written policy will include loss of income that might result from breakdowns, as well as loss of income from other hazards that would temporarily close down your business.

Things to do
o Employ the service of insurance agent to handle all of your insurance requirements.

o Use a broad form of business property insurance.

o Consider a health insurance policy for your employees to help keep them
o Maintain a clean and safe environment in your workplace.

o Increase all your insurance coverage appropriately as your business grows.
o Consider maintaining a buy-sell agreement with your partners, funded by life assurance in the event of the death of a partner.
o Carefully read all the terms of the insurance, make sure you understand it before signing to it

o Seek legal clarification on clauses you do not understand
Things to avoid.
o Overlooking ongoing employee training on maintaining workplace safety.
o Feeling that you can't afford insurance. You can't afford not to have it.
o Dealing with contractors who cannot furnish you with insurance certificates.
o Permitting your insurance policies to lapse for non-payment of premiums.
o Dealing with insurance providers with substandard ratings.
o Withholding information from your insurance provider. Give the provider a complete picture of your risks.
o Going “uncovered" (uninsured) in any category of insurable and significant risk.
o Overlooking flood or earthquake insurance if you are in an area prone to high risk.
o Signing insurance terms you do not understand.

Useful links on insurance companies in Ghana, their contacts and products.

http://www.nicgh.org/live/en/?pg=128&pp=95
The above link gives you Non-Life companies in Ghana, their contact persons and addresses.

http://www.nicgh.org/live/en/?pg=129&pp=95
The above links gives you the list of reinsurering companies Ghana

http://www.nicgh.org/live/en/?pg=133&pp=97

The above links gives you insurance products in Ghana

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