By Elliot Williams
The collective effort by Ghana’s insurance industry to drive macro-insurance as a key tool for expanding risk management in the country has received a crucial boost with the launch of an innovative new product, called Home/Office 360, last week in Accra.
The product is offered as a result of a collaboration between Priority Insurance – a major non-life insurance company that ranks as one of the fastest growing underwriters in the country, and iRisk Insurance Brokers and Management Consultants, a leading insurance brokerage.
Home/Office 360 is an innovative content insurance product designed specifically for the micro sector. The product is aimed at homes, offices and commercial enterprises alike. The product even has risk management extensions to cover public liability and personal accident.
But most importantly, beyond the sheer scope of the risks it covers for micro-insurance customers, it is the cheapest insurance policy on offer in Ghana, with premiums starting from GH¢360 a year.
This gives it the potential to dramatically increase the insurance penetration rate in Ghana, which Priority Insurance’s Managing Director and Chief Executive Officer, Matthew Aidoo, notes is a mere one percent of the populace.
While many industry analysts claim the Ghana’s insurance penetration rate has risen significantly higher than that due primarily to the impact of micro-insurance over the past year or two, it is universally acknowledged that the country has one of the lowest penetration rates on the African continent.
“We are proud to unveil Home/Office 360 as a result of extensive research, creativity and collaboration,” enthused Matthew Aidoo at the product launch, referring to the rare degree of collaboration between the primary underwriter and the brokerage that teamed up to design and roll-out the product. “This product addresses the needs of our customers and, especially, the micro and small-scale enterprises market.”
Instructively, the industry regulator, the National Insurance Commission, approved the product for offer to the insuring public in record time. This is in line with the NIC’s ongoing implementation of its new Inclusive Insurance Strategy, which has been developed with the technical support of the United Nations Development Programme using inputs from all relevant stakeholders. The strategy aims at making affordable and relevant insurance cover available to micro and small businesses as the means to vastly expanding insurance cover in Ghana.
Therefore, the launch of the Home/Office 360 micro-finance product has come at a most opportune time.
“The NIC is in the process of putting together a multi-stakeholder steering committee to coordinate and oversee the implementation of the Inclusive Insurance Strategy,” revealed Kofi Andoh, the acting Insurance Commissioner when speaking at the new product launch, adding that: “The NIC is also implementing interventions on both the demand and supply sides to fill the micro and small business insurance gap.”
An example of this is NIC’s collaboration with development partners such as GIZ – the German Government’s international development assistance agency – to build the capacity of insurance companies to develop and administer appropriate insurance products for the micro and small business sector.
On the demand side, the NIC – in collaboration with the Insurance Awareness Coordinators – is organising a series of Micro and Small Business Clinics across the country to educate owners and operators of micro and small businesses on how they can use insurance as one of the most effective tools to mitigate their risks.
Andoh asserted: “It is common knowledge that ordinary Ghanaians face challenges and risks daily without any form of protection. In the recent past, there have been some fire outbreaks in some of our marketplaces which have had devastating impacts on those who are least able to cope financially. It is the NIC’s expectation that the Home/Office 360 will help to address this gap”.
Now Priority Insurance and iRisk Insurance Brokers will have the formidable task of devising effective distribution channels and strategies, while practically demonstrating the value that the product offers.
