1. What is insurance?

Insurance is a financial contract which transfers risk from the customer to the insurer. It has been defined as an arrangement by which one party, the insurer, promises to pay another party, the insured or policyholder, a sum of money if something happens which causes (or has the potential to cause) the insured to suffer a financial loss.

2. I am an individual with two children, what type of insurance do I need?

There are a number of child education policies which you can choose from. Some companies call it Edu child, others call it …

3. I am the owner of a company who employs 10 people in my factory. We have 6 cars, what type of insurance is suitable for me?

Looking at your business, a number of insurance policies are applicable. Motor insurance is needed to cover your company cars, workman compensation for your staff, fire and burglary for the office building and its content, business continuity to cover you from all losses and non-trading activities.

4. What is public liability insurance?

Public liability insurance is an insurance policy purchased by an organisation or house owner to cover any losses to third parties, arising out of business activities. For example: if a woman is passing near your office premises and the walls of your office collapse and causes injury to her, the cost of her hospital bills will be taken care of by the company in question. This is why public liability insurance is carried out to litigate such unforeseen occurrences.

5. I have heard of comprehensive motor insurance policy, can you educate me on that?

Motor insurance is an insurance policy that is carried out on all vehicles. The motor traffic and road authority Act 10 makes it compulsory for any vehicle that walks on the public road to be insured. Failure to do so can lead to prosecution. There are three main types of motor insurance namely;

  • Comprehensive motor policy
  • Third party only
  • Third party and theft

6. One agent came to my office to sell insurance to me. He mentioned life insurance. I am kind of interested. Tell me more about life insurance policies.

Basically, there are two main types of insurances:

  • Life insurance
  • Non-life insurance (general insurance)

The former has to do with all insurances that pertain to life. Some of the popular life insurance policies are Edu care, funeral insurance …

7. I have heard of home owners comprehensive. What is that? Is it different from shop owners comprehensive?

Shop owners’ comprehensive is an insurance policy that is undertaken by the policy holder or the insured. It covers risk that pertains to the shop. This policy is normally taken by the shop owners to cover fire or theft.

Home owners’ comprehensive on the other hand is a comprehensive policy that is taken by a house owner to cover his/her household properties including the bedroom, kitchen and the hall.

The difference is that whilst shop owners’ has to do with people who own shops, home owners on the other hand insure properties on their homes.

8. What is the difference between marine insurance and aviation insurance?

Marine insurance consists of all insurances that pertain to the ship. These include the marine hull …

Aviation insurance on the other hand covers planes and its related equipment …

8.1. Workman compensation, what is that?

The workman compensation Act 19 … makes it compulsory that every employer who employs more than five staff must have an insurance policy to cover those staff so that any accident arising as a result of their work could be covered. It is a mandatory regulation therefore failure to carry it out may lead to prosecution. This policy is normally calculated by adding all salaries of members of staff, divided by the number of years involved.

9. How will claims be paid when there is an accident?

Claims payment is the main reason for the purchasing of insurance. It is therefore the duty of the insurance company to make sure that claims payment is as easy as premium payment. When the unexpected happens, and you need to make a claim, follow the following steps:

  • Inform the insurer
  • Go for police reports
  • Fill claim forms
  • Await payment of claims

Normally, it takes a while to get your claims settled. At times, you’ll have to go through a lot of hustles and sometimes, your claims would be repudiated by the insurer. This is why it pays to use an insurance broker to handle all your insurances from purchasing of insurance through to the payment of claims for free.

10. Who is an insurance broker and why do I need one?

An Insurance Broker is a professionally qualified independent insurance adviser who represents the interest of any individual or organization with a view to obtaining the best possible deal to suit the individual, group or organizations’ specific needs. They help identify the risks that you or your business may be exposed to. The Broker will advise you on what insurance’s are available for these risks and will canvas the wholesale business insurance market to obtain the most advantageous terms for these covers.

In both business and personal matters, correct insurance is vital. Wrong or inadequate insurance protection can lead to disastrous consequences. The right advice makes all the difference and prevents costly mistakes. Insurance Brokers are specialists in insurance protection, are independent and have an in depth knowledge of the insurance market and are able to provide professional, objective advice on identifying risks and exposures and recommend the most cost effective solutions.

11. I operate three shops in Accra; do I need insurance at all?

yes, you will need a shop owners’ comprehensive policy. (Refer to Q. 7)

12. A broker and an agent, are they the same?

No. There is a difference between the two: An Insurance Agent acts on behalf of one or more Insurance companies and can only access those insurers’ products where as a Broker is an agent of the policyholder. He is therefore obliged to act in your best interests, and because he is not tied to any particular insurer, he is able to arrange the best terms for you at very competitive rates.

13. Is insurance compulsory?

I will yes and no. some policies are compulsory while others are not. Insurance policies such as fire, motor, aviation … are compulsory and failure to insure such undertaken could lead to prosecutions. Insurance policies such as burglary, shop owners’ house owners’, life policies, etc. are not compulsory but it pays to have such insurances.

14. Can you advise me on the type of insurance for banking/ microfinance, construction, school, college/university, restaurant in tabular form?

Public Liability (refer to Q. 4)

Bankers’ indemnity is an insurance policy undertaken by banks, and all financial institutions that handle money. (Refer)

Third party is an insurance policy to cover the person other than the owner of the insurance.

Funeral insurance is undertaken to cover funeral cost of a deceased fellow.

16. What is insurance premium? How do insurers calculate my premium?

Insurance premium is the annual payment of insurance on your policy. It is calculated by the sum insured multiplied by the rate of the insurance company. The sum insured is the amount of money you’ll need to bring you back to your original state.

17. How to Make an Insurance Claim?

Before making an insurance claim, be sure to check out your policy details to determine if you’re getting the appropriate coverage for the loss or damage. You may have numerous forms of insurance, so it would be vital for you to choose which policy you’re going to claim under. Again, insurance brokers would do the job for you.

18. Reasons why claims are rejected

Many insurance companies (insurers) repudiate claims due to the following reasons.

When you are making an insurance claim after a car accident, you may be counting on the money coming in from that claim in order to pay your medical bills and other costs. Unfortunately, things do not happen that way and sometimes your insurance claim is denied. When this occurs, it is important to understand exactly why was denied. Every situation is treated differently, of course, but below are some common reasons that insurers give for denying claims.

19. Driving under the influence of alcohol

Drink-driving is a crime and an insurance company will deny liability when you turn at their door for claims. Driving under alcohol is not admissible, this also relates to a passenger who was injured under drunk driving.

20. Driving without a valid license

There is no difference between a driver without a license and one with an expired license. Insurance policies require that the driver of the insured vehicle be “authorised and qualified by law” to operate that vehicle. Therefore if you are the owner of the vehicle, you must be authorized and qualified by law to drive it and must confirm anyone who drives your vehicle to be qualified by law to drive it.

22. What to do when your claim is rejected

If you don’t have a broker and you claim is rejected, hire a claims expert to appeal for you.

21. When your policy expires

If your policy expires and you refuse to renew it, no insurance company will fulfill any financial obligation towards you. Expired policy, expired claim!