Fires have become a major threat to Ghanaian businesses, especially market traders. Millions of cedis and properties are lost during these times.

A national study by the National Insurance Commission (NIC) has reported fire as the leading risk threatening informal-sector businesses, according to a nationwide survey by the National Insurance Commission (NIC).

The findings suggest that insurance companies stand a chance to attract more small businesses in the informal sector by offering insurance that is affordable and suited to their needs.

The NIC-YEA Insurance Awareness and Risk Perception Report found that fire was cited by 41% of respondents, equivalent to 10,850 people, making it the most frequently reported business risk.

Theft and robbery followed at 36%, while illness accounted for 34%. Traders and other informal workers risk losing their goods, being unable to run their businesses, and losing their income when unexpected events occur.

218 graduates of the Youth Employment Agency (YEA) over a period of three months, i.e., from January to March, collected information from 26,493 people across 10 regions of Ghana.

An analysis of the data indicated that market traders had a median amount of GH¢25 per week, while drivers recorded a higher median of GH¢30 per week.Artisans were willing to pay a median of GH¢20 a week for insurance, the same as the national figure. Store owners and youth entrepreneurs, however, recorded a lower median of GH¢15.

The report found that half of the respondents were willing to pay between GH¢10 and GH¢50 weekly, with GH¢20 representing the national median.

Based on the findings, the National Insurance Commission (NIC) proposed three pricing levels for insurance products targeting informal businesses. Basic coverage would cost between GH¢10 and GH¢15 a week, standard packages between GH¢20 and GH¢30, while comprehensive cover would range from GH¢40 to GH¢60.

The amount respondents were willing to pay also varied across regions. Those in Ashanti, Greater Accra and Bono recorded a median of GH¢30 per week, compared with GH¢10 among respondents in the Northern and Volta regions.

The findings point to the need for insurance products that match the financial circumstances of informal businesses while protecting against the risks they face.

To make insurance easier to access, the report recommends allowing customers to pay premiums weekly through mobile money, simplifying claims processes and issuing policies digitally.

However, the amounts respondents said they were willing to pay may not necessarily translate into actual purchases.

The report therefore highlights the need for insurers to offer affordable premiums, explain policy terms clearly and settle claims reliably to encourage more informal businesses to take up and maintain insurance coverage.