Insurance basics: protecting what you have
Learn how premiums, cover, exclusions, excess and claims work, and where to check an insurer's licence. Free, neutral education; amounts are examples only.
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One bad day
A fire in the shop. A stolen motorcycle. A hospital bill nobody planned for. One bad day can wipe out years of hard work. Insurance is how you protect yourself from that day.
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One bad day
A fire in the shop. A stolen motorcycle. A hospital bill nobody planned for. One bad day can wipe out years of hard work. Insurance is how you protect yourself from that day.
A shared pot
Here's how it works. Many people each pay a small, regular amount, called a premium, into a shared pot. When something bad happens to one of them, the pot pays out. You pay a little that you know about, to avoid paying a lot that you don't.
Four policy words
Now the key words. The premium is what you pay, monthly or yearly. The cover is what the policy protects and how much it will pay.
Read the exclusions
Exclusions are what it does NOT cover. Read these carefully; this is where surprises hide.
Example only — excess and payout
And the excess, or deductible, is the part of any claim you pay yourself before the insurer pays the rest.
Required cover and choices
Some cover is required by law, like third-party motor insurance for vehicles on the road. Other cover is your choice: your shop's stock, your goods in transit, your health, your life, cover for your family.
Check the insurer's licence
Before you buy, check the insurer is licensed. In Nigeria, that's the National Insurance Commission, NAICOM. In Ghana, the National Insurance Commission, the NIC.
Claims and documents
And ask how claims work: what you need to report, by when, and how long payment takes. Finally, keep your documents safe, and tell the insurer the truth when you buy. A claim can be refused if the details you gave were wrong.
Check what you learned
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General education, not financial advice. Amounts shown in illustrations are examples only.