development of micro insurance in kenya aio life insurance seminar 2015 lomé - togo presented by:...
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Agenda 1.Key Facts About Insurance in Kenya 2.Drivers for Micro Insurance 3.Challenges 4.Parting thoughts 5.Questions/Comments SLIDE 3 AIO Life Insurance Seminar 2015 Demystifying Life InsuranceTRANSCRIPT
Development of Micro Insurance in KenyaAIO Life Insurance Seminar 2015
Lomé - Togo
Presented by: George Odera
27th November 2015
“Just as a fish doesn't know it is wet, so do companies often fail to see or feel the very opportunities they are swimming in” .Pam
Handerson
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Agenda
1. Key Facts About Insurance in Kenya
2. Drivers for Micro Insurance
3. Challenges
4. Parting thoughts
5. Questions/Comments
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AIO Life Insurance Seminar 2015
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1. Key Facts About Insurance in Kenya
A small proportion (7%) of Kenya’s population (44m) have access to insurance.
Insurance penetration rate is 3.4% as a percentage of GDP
45% of Kenyans are aged below 15 years.
United Nations Human Development (2009) estimated Kenya’s poverty levels at 19.8%of the population.
Low-income households heavily exposed to the consequences of risks that materialize.
They might :• be compelled to sell assets cheaply• remove their children from school• relocate to cheap settlement areas (slums)• take on high interest loans
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2. Drivers for Micro Insurance
Potential target market in excess of 11 million adults.
Innovation (Mobile Phones)
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Drivers for Micro Insurance Cont.
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Distribution Channels. (Mobile Money)
Mobile money has become the preferred mode of payment.
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Drivers for Micro Insurance Cont.
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Strategic Partnerships•Govt. is offering livestock insurance to pastoralists thru’ insurance companies.
•Insurance companies have partnered with self-help groupsto provide life cover to their members.
Regulations•The Insurance Regulator in Kenya has developed a Micro Insurancepolicy paper.
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3. ChallengesEmployment insecurity and low levels of disposable income
Low literacy levels and general financial awareness.
Poor perception of insurance-family is viewed as a traditional safety net.
Cultural beliefs-anticipating misfortunes is a taboo.
Insurance brands command lower trust levels compared to other financial institutions.
“No one wakes up in the morning wanting to buy insurance – But we are convinced that people wake up in the morning worried about the risks they face”
– Richard Leftley, CEOMicroensure
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4. Parting thoughts..
AIO Life Insurance Seminar 2015
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There a huge potential for Micro Insurance to increase access to life insurancecover for the wider Kenyan population.
Consumer education and building trust is of paramount importance.
There are various success drivers for micro insurance, however, we needto be cognizant of the underlying challenges.
Companies ought recognize the opportunity that micro insurance presentsand develop products tailored to meet the needs of the clients.
