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BimaNet Kenya: Disrupting the insurance landscape

By harnessing the power of word advertising, the audacious team at BimaNet has introduced an innovative model of distributing life insurance through network marketing

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BimaNet CEO Ms Wanjiru Githiomi- Nganga.

Approximately 90 years since the establishment of the first Insurance company in Kenya, insurance penetration currently stands at a dismal 2.73% of GDP compared to the global average of 6.28%.

Issues ranging from lack of education, distrust of the insurance industry, high cost of premiums, slow uptake of innovation, competing interests for limited resources and poor training of insurance distributors have been touted as some of the culprits for the poor performance by this sector.

The Association of Kenya Insurers (AKI) hopes to increase the penetration to 6% by the year 2020. To achieve this target, the industry is set to embark on a comprehensive campaign to educate the public about insurance and encourage them to embrace innovation and technology in this sector.

BimaNet Kenya Ltd, Africa’s first and only income protection and insurance benefits club is working with industry stakeholders to achieve this goal and surpass it. This innovative company has repackaged Life Insurance thereby making it more palatable and interesting to Kenyans who would not ordinarily purchase this product as a matter of course. By harnessing the power of word advertising, the audacious team at BimaNet has introduced an innovative model of distributing life insurance through network marketing. Backed by state of the art technology, their Customer Referral Programme provides an opportunity for anyone to plug into the system and build a lucrative business with a residual income component.

When a customer subscribes to BimaNet, their membership entitles them to a 5 in 1 package of insurance products comprising a life policy, critical illness, last expense, in hospital cash payout and personal accident rider benefits. BimaNet provides these benefits at a substantial discount of up to 75%, augments them with a Benevolent Fund that doubles the sums assured by the underwriter and pays cash back for no claims. The company has negotiated a Group Life scheme with UAP- Old Mutual and Sanlam and they pass on these discounts to their individual members. BimaNet is also in discussions with several other underwriters who have the capacity to service the anticipated critical mass of members that the company is targeting through its comprehensive digital media awareness campaign.

Speaking about the business, BimaNet’s CEO, Ms Wanjiru Githiomi- Nganga says: “One of the primary reasons touted for the dismal penetration statistics is that our industry has been heavily reliant on less than 4000 active insurance distributors to convert about 20 million insurable Kenyans to customers. It behooves us to rethink and innovate around insurance distribution so that we can turn the tide on the dismal statistics of insurance penetration in Kenya. In this regard, BimaNet is tapping into the potential of all economically active Kenyans with a flair for sales, enrolling them as members of the club and nurturing them into successful team builders and distributors of insurance within its micro marketing platform.” BimaNet is now experiencing a rapid growth spurt in member subscriptions because there is something in it for the ordinary Kenyan to take up Life Insurance, “We provide insurance with a twist that puts money in your pocket!” Ms Githiomi – Nganga concluded.

The BimaNet distribution model is a creative adaptation of very successful prototypes across the globe which have transformed the insurance landscape especially in South Africa, India and the USA.

Related: How technology is reshaping insurance landscape

John Ndara, BimaNet’s Resident Actuary and Executive Director said: “It took us four years of research and planning to adapt these models to suit the local conditions. We have conscientiously structured our business to address most of the pain points in Kenya’s insurance industry and develop a first of its kind distribution model that establishes a win-win relationship between the underwriters, insurance distributors (Agents and Brokers) and the general public at large.”

BimaNet Kenya Ltd is principally a distribution channel for life insurance but the company is also working towards introducing a wider bouquet of products to this captive audience such as medical, motor vehicle, education policies, household to mention a few. The BimaNet business model is certainly a game changer in the Kenyan insurance sector; their entry into this market will undoubtedly safeguard more families from plunging into a financial crisis when disaster strikes.

 

Business Today is the leading independent online business website in Kenya. Started in 2012 by a veteran business journalist, it has a huge following both in Kenya and abroad. It covers various business and related issues. Email editor at: [email protected]

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Insurance

Some saving lessons for teachers

Sanlam Life says this will provide relief against various risks and help enhance social and economic stability for teachers

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Sanlam Life Chief Executive Stella Njunge signs the cheque from Sanlam Kenya Group to the Teachers Service Commission (TSC) as the TSC Chief Executive Nancy Macharia looks on at the TSC Headquarters in Upperhill, Nairobi.. The funds from Sanlam Kenya Group will go towards supporting the TSC Jubilee celebrations across the country.

Sanlam Life, the local Life Insurance unit of Sanlam Kenya, has advised the teaching fraternity to consider adopting a savings culture as a poverty eradication strategy.

The adoption of a savings culture including Life Insurance and related general insurance products to provide relief against various risks, will help enhance social and economic stability for teachers among other professionals.

Speaking when she presented a Ksh 1.5 million donation to the Teachers Service Commission in support of the Commission’s 50th anniversary celebrations’, Sanlam Life Chief Executive Officer Stella Njunge said the firm is undertaking a consumer education programme to further entrench the need for life insurance products.

“At Sanlam Life we are proud to be partnering with the TSC to celebrate the 50th Anniversary milestone and also to advance consumer awareness on the need for Life Insurance products,” Njunge said, adding that “Life Insurance products play a key poverty alleviation and financial inclusivity role.”

READ: How to save now for a stress-free tomorrow

Flanked by TSC Chief Executive Officer Nancy Macharia, she reiterated the need to adopt modern saving tools in line with the Vision 2030 National Development plan. The Vision 2030, she noted singles out financial inclusiveness as a key avenue to national development.

“Adoption of Life insurance products helps to alleviate economic challenges that arise in the event of a breadwinners’ demise by providing financial resources to the bereaved families,” Ms  Njunge said.

With a life insurance cover, the need to call for fundraising for school fees among other needs is reduced by almost 95% providing comfort to such families, she said.

Sanlam Kenya has been in partnership with the TSC for the last 30 years, providing life insurance for more than 44,000 teachers across the country.

Related: Sanlam signs deal with StanChart to provide insurance

The funds donated by Sanlam Kenya will go towards supporting the TSC jubilee commemoration activities at both the county and national levels that include tree planting, launching of the TSC documentary and commemorative book, recognizing and awarding outstanding persons who have supported the commission since its inception among other exhibition of TSC services, processes and interacting with stakeholders.

Sanlam Kenya meets the savings and financial services needs of its clients by offering a range of products and services including retirement savings plans, life insurance, accident and health insurance through Sanlam Life, Sanlam General and Sanlam Investments. The group provides employee benefits, credit life and pension rights to corporate clients too through an extensive network of agents and employees throughout the country.

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Business News

UAP eyes South Sudan’s lucrative oil and power pie

Officials from the Transitional Government of National Unity and the private sector are set to gather in Juba to tackle energy and infrastructure challenges and showcase opportunities

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UAP Insurance South Sudan’s is angling for a piece of the lucrative oil and power industry ahead of the first ever global conference on energy and infrastructure to be held on October 11 and 12 in Juba.

The conference brings together industry experts, government officials from the Transitional Government of National Unity and leaders from the private sector will gather in Juba to tackle energy and infrastructure challenges and showcase opportunities.

Among the key discussion points will be assessing the technology and infrastructure needs for development of the upstream, midstream and downstream sectors, as well as how to finance, build, implement and operate new projects, taking on security challenges and overcoming insecurity on the oilfields and the need for regional energy integration in downstream infrastructure, including refineries and export routes.

It has been commissioned and endorsed by the ministry of Petroleum of South Sudan and will feature keynote inaugural speeches from President Salva Kiir and Amb. Ezekiel Lol Gatkuoth, the Minister of Petroleum and a plenary session moderated by the UAP Old Mutual Group Managing Director, General Insurance James Wambugu.

UAP has provided general insurance risks for Dar Petroleum Operating Company (DPOC), Greater Pioneer Operating Company (GPOC) and Sudd Petroleum Operating Company (SPOC).

“Based on the outcomes of the conference, UAP will be keen on capitalising on the potential insurable interest for the infrastructure both upstream and downstream as well as the economic activity generated
from the multiplier effect of these investments”, said UAP South Sudan Managing Director Kris Mbaya.

“Further, we also look forward to insuring existing (national) infrastructure like the refinery, the pipeline and the operating wells that have already been sunk and participating in structured financing instruments for the necessary State infrastructure such as roads, bridges, pipelines & communication systems, Specific to existing businesses and infrastructure, UAP conducts risk surveys and assessments to advice on the risk to be insured and ways to mitigate on these risks” added Mbaya.

“For new investors in the country, we are able to leverage the collective insight enabled by our wide network of strategic partners in order to advice on investment processes, regulations and licensing in addition to providing a seamless insurance portfolio,” he said.

Related: FEP Holdings partners with UAP to offer insurance services

Already, UAP has had successful joint ventures in South Sudan including an iconic commercial property, UAP Equatoria Tower, a joint venture between UAP and the Central Equatoria Development & Investment Authority.

“Possible options of partnership can be explored through our Investment arm of the business, if aligned to our business strategies. Another option lies in bringing together our investors to pool funds for investment into public/private partnership projects that would be anchored on concessions” Mbaya noted.

According him, the ongoing conflict in some parts of South Sudan has made it difficult for reinsurance partners to support political and terrorism covers due to the high probability of the risk occurring.

“From an insurance perspective, the country has been in conflict for the last three years making it a great challenge for insurers to develop covers that have acceptable risk profiles.” he said.

According to Mbaya, UAP will also be seeking to provide covers for business interruption to the players in the oil and gas sector.

Currently, 95% of the South Sudan budget is financed by oil revenues, which has resulted in near a total collapse of the financial system with corporates lacking access to hard currency and in this way impacting the efficacy towards meeting business obligations.

“We encourage other investors to come to South Sudan because the business community needs a strong ecosystem to support the players. We serve in the service industry and without the support of other aspects of the economy, this impacts us directly,” he said.

Despite the conflict, UAP rates South Sudan’s outlook as positive and promising based on the current state of the economy as well as the government efforts in securing peace.  “We are prepared to realise gains of a peaceful environment,” Mbaya said.

UAP Insurance has been in operation for 10 years in South Sudan. It is part of the UAP Old Mutual group in East Africa and part of the wider Old Mutual Plc Group which is a leading insurance and investment player with involvement in all segments of the energy business, including working with the three operating consortia.

UAP Insurance South Sudan completed the construction of its UAP Equatoria Tower in 2017; a Grade ‘A’ office complex that is also Juba’s tallest building.

Focusing on dynamic workshops, presentations, panels and keynotes, the event will create an environment for networking and deal-making among South Sudan’s energy leaders.

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Insurance

Sanlam signs deal with StanChart to provide insurance

The partnership combines Standard Chartered Bank’s experience and Sanlam Kenya’s deep insurance expertise to innovate and create value add products

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Sanlam Kenya has partnered with Standard Chartered Bank Kenya Ltd to distribute general insurance products to its existing and potential customers through its wide spread distribution channels, through their subsidiaries , Sanlam General Insurance Limited and Standard Chartered Insurance Agency Limited.

The partnership combines Standard Chartered Bank’s experience and Sanlam Kenya’s deep insurance expertise to innovate and create value add products.

“This agreement with Sanlam Kenya, our valued bancassurance partners, aims to increase and consolidate our market on this platform. With the fortified inclusion of bancassurance products to our portfolio, we aim to make Standard Chartered Bank a one stop financial service provider. We now have a diverse and rapidly evolving distribution platform here in Kenya including a direct and online capability and strong financial adviser and agent network, all of which benefit from the strength of the Standard Chartered Bank brand,” Chief Executive Officer Lamin Manjang noted during the signing of the partnership.

Group Chief Executive Officer Sanlam Kenya Mugo Kibati noted that the partnership was a long term fit for Standard Chartered Bank and Sanlam Kenya as they aim to create value for their customers, employees and shareholders.

Related: Sh2.7bn Sanlam Tower nears completion

“This agreement demonstrates commitment to the future enhancement of insurance distribution in an effort of increasing market penetration in the country. Our life insurance markets will be significantly enhanced with this new distribution channel. We are ready for it,” said Mr Kibati.

Sanlam Kenya meets the savings and protection needs of individuals by offering a range of products and services including retirement savings plans, life insurance, accident and health insurance through Sanlam Life, Sanlam General and Sanlam Investments. The group provides employee benefits, credit life and pension rights to corporate clients too through an extensive network of agents and employees throughout the country.

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Insurance

Travel insurance demystified

Travel Insurance covers you for incidents that are out of your control so that you do not have to spend your own money if something goes wrong

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Travelling has always been associated with risks. It is no secret that when you travel, there is much that is out of your control. Flights can be delayed or you might need to return home if an emergency occurs.  In most cases, you may end up losing the money you had already paid and you will have to make new bookings too. Without a travel insurance, disruptions to your trip can end up costing a fortune!

Travel Insurance covers you for incidents that are out of your control so that you do not have to spend your own money if something goes wrong. In addition, it provides practical assistance when abroad around the clock giving you and your loved ones 24/7 protection.

Resolution Insurance Managing Director, Alice Mwai speaks on a scenario where Travel Insurance came to the aid of a client. “There have been many instances where clients have benefitted from travel insurance. Recently a client who travelled to Egypt for official duty fell sick and ended up being admitted in hospital for a few days. On contacting our assistance services, a guarantee was given to the hospital through our agents who were tasked with monitoring the client’s treatment. We settled the hospital bill which was more than Ksh 1.4 million. This is just one case but every so often we have claims for lost or stolen property.”

It is important to note that some countries do not permit foreigners entry without Travel insurance. Some of these countries include the United States of America (USA), the 26 European Schengen Countries that include, Belgium, Italy, Germany, Luxembourg, Netherlands, Portugal, Sweden and Switzerland. The UAE, Cuba, Qatar and Turkey also require mandatory health insurance from foreigners.

Travelers can choose from a selected range of packages to suit different traveler’s needs. Annual multiple trip packages best serve frequent travelers. Travelers under such packages benefit from one off yearly payments and for those who are not regular traveler’s single trip packages are the best option. Inbound travel packages best suit foreigners travelling into Kenya for business or leisure.

ALSO SEE:  How technology is reshaping insurance landscape

The tourism industry also benefit from travel insurance in that tour operators can enrich their safari packages with inclusion of travel insurance.  On the other hand, tourists have a tangible cover that can help them return to their home country in the event of an emergency hence reduce the financial loss that comes with refundable deposits or change of travel plans.

Insurance companies within the East African Community comprising of Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda are making strides in ensuring common regulatory standards which may directly impact travel insurance in the region. While plans are still underway to streamline insurance standards within the EAC, the partnership presents a unique opportunity for growth as we are likely to see a lot of cross-border trade and regional tourism. The opening of borders and improvement in infrastructure could also mean that road transport becomes a cheaper mode of transport making it easier and cheaper to tour other countries.

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