Addressing the devastating effect of Market Fires on the informal sector, the critical intervention of insurance policies

A GNA Feature by Bertha Badu-Agyei

Accra, June 27, GNA – Market fires in Ghana have had devastating impact on women who operate small and medium enterprises usually trading in the markets.

Many lose their livelihoods and income running in millions of cedis, a 2022 data from the Ghana National Fire service, put losses due to fire at more than 64 million cedis in about 967 fire outbreaks alone.

This affected more than 2,000 traders in the year comprising of market fires, and notable to mention are the Kejetia market in Kumasi, Kantamanto, Odawna, Madina markets in Accra and Juaben Serwa market in Koforidua.

Meanwhile, most of these women in the informal sector rely on credits from financial institutions, family, and friends, unfortunately, with no form of insurance they are left vulnerable to fire outbreaks and any other disasters.

In July 2019, Ama Grace (not real name) a 38-year-old trader invested Gh¢50,000 cedis into her trading business in anticipation of Christmas sales and was looking forward to reaping the returns and pay back the loan facility of Gh¢40,000 cedis she took from a finance company.

The investment included infrastructure where she moved from a metal container to a rented shop nearby, did some interior upgrade such as painting and tiling, she also restocked and added on other items just to attract a lot of clients.

Each month she was expected to pay an amount of Gh¢1,500 for the next three years to defray the bank loan, like every businessperson, Ama hoped to expand and upgrade her business with these interventions and breakthrough, but that was not her reality.

In October same year, tragedy struck, the Koforidua central market where Ama’s new shop was located was hit by a fire outbreak, her shop was among the over 60 shops gutted by the fire and burnt beyond recognition, the only items she could salvage were the metal beams supporting the frontage of the shop and the broken tiles, all her investments gone down the drain.

Unfortunately, Ama has no insurance package to restore her business back, just like the over 200 affected traders mostly women, the benevolence of government, philanthropists and family, and friends now becomes the only source of hope for sustenance.

Ama is shattered, all her dreams have come to naught, how to pay back the loan, get a source of livelihood are pains she has to bear with, until such time that luck comes back her way, the reality of insuring her shop, which she ignored and thought was too expensive has dawned on her.

“I remember when I moved into my new shop some insurance agents came to me to sensitise on the need to have an insurance policy to cover my investments in the event of any disaster, but I was not interested because I thought it was too expensive and not necessary.” She sadly noted.

Ama Grace is not alone here, there are hundreds of traders who have lost their livelihoods due to market fires and the fact that they had nothing to fall on after the disaster had rendered them in a state of poverty and despair only clinging on the hope of “Nyame bekyere” to wit God will provide, the typical mentality of the Ghanaian.

“I lost my shop containing wares more than Gh¢20,000 cedis in the Odawna market fire and since then have not been able to recover, paying debts and finding another place has not been easy for me” Aunty Ama, a victim of the Odawna fire outbreak last year who recounted her ordeal to the GNA said she thought insurance was for the rich and big companies.

The notion has always been that insurance policies are for the affluent, rich, and big businesses who have huge infrastructure and not for small traders in containers or stalls at congested markets and therefore it is difficult to find any trader insuring his or her wares at Makola, Odawna, Madina or any wayside markets.

Meanwhile, GNA checks at the National Insurance Commission (NIC) showed that there were several insurance packages specifically designed to meet the demands and pockets of traders in the markets to mitigate impact of market fires on women, providing the financial protection against losses as well as help to recover from such disasters and rebuild their businesses.

They include the Ghana Re Insurance Company’s “Market Fire Insurance Policy” the SIC “Traders Insurance Policy and Star Assurance Company’s “Small Business Insurance Policy, these policies typically cover losses due to fire, burglary, and other risks, it also provides additional benefits such as business interruption coverage and liability insurance.

The reality is that many women in Ghana’s informal sector may not have access to these insurance policies due to obvious reasons, lack of awareness, high premiums and limited financial resources and the general mentality that insurance policies were for big businesses.

Mr Mawuli Zogbenu, Public Relations Officer of the NIC in an interview, said his outfit and the Ghana National Fire Service had embarked on a nationwide sensitisation drive on the importance of insurance policies and the benefits in the event of any disaster or crisis to cushion victims.

However, he agreed that there was the need for intensive and consistent sensitization of market women and small businesses including dressmaking shops, hair salons and other business establishments to understand the importance of insurance policies as an investment to be recouped in times of disasters.

In as much as the sensitization drive is good move, the need for the NIC, the Ghana National Fire Service and the respective local assemblies to have a concerted and coordinated efforts to ensure that traders and small businesses obtained an insurance policy as pre-requisite to granting of the business operating certificates or permits was imperative.