Competition in the insurance industry has become very keen with products and premiums being driven by competition and, sometimes, by undercutting.
Travel insurance policies have become a fairly new phenomenon in the industry, but it is one area in which competition has left an indelible mark.
Premiums here have been largely driven by keen competition, having changed about two times a year, industry players have confirmed.
A one-month policy, which costs an average of $70 at the start of the first policy, now goes for about $45 on the average.
Travel insurance used to be part of personal accident policies without health component for most insurance companies until about two years ago when Schengen States, mostly members of the European Union, decided to make it mandatory for travellers to possess travel insurance policies which cover particularly sickness.
Apart from going to the United States of America, most Ghanaians travel to Europe, hence a large market was created for the insurance industry.
“This is a grey area so the industry decided to tap into it,” Mr George Addae, Manager, General Business at CDH Insurance, cited as one of the reasons why that segment of insurance was growing.
So far, six companies, Enterprise Insurance, Vanguard Assurance, CDH Insurance, Phoenix, Quality Insurance Company, the State Insurance Company and Provident Insurance are selling travel insurance policies with their foreign partners.
The seventh company, Metropolitan Insurance, is just about to start the policy.
Mapfre Asistencia, a Spanish reinsurance and service company, alone partners about five insurance companies.
The company affords its Ghanaian counterparts the opportunity to stretch their policy coverage to clients travelling to Europe, parts of Asia, categorised into two zones, and a special package for travellers within Africa.
Mr Addae explained that the travel insurance policies for most companies was a hybrid of health, personal accident and other forms of insurance cover.
While the Schengen States require health insurance covers of up to 30,000 euros, the ceiling given by some of the insurance companies range between 250,000 euros and unlimited.
The most comprehensive travel insurance policy has several covers such as medical expenses and hospitalisation of up to 30,000 euros, unlimited provision for transport and repatriation in case of accident or illness, repatriation of mortal remains, legal defence, compensation for in-flight loss of checked-in baggage.
According to him, apart from the policy being a requirement for travelling to the European states, the general response was good.
He, however, said Ghanaians in general were not making maximum use of the whole idea of a travel insurance when they were not under any obligation to purchase it.
“We have this as a special package for Africa, but it has been largely under-patronised, because clients do not recognise the actual benefit they could reap from there,” Mr Addae said.
Story by Samuel Doe Ablordeppey