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New mortgage insurance unveiled

NAIROBI, Kenya, Oct 1- The growth of the mortgage business is continuing to spur the development of innovative products that are designed to encourage more Kenyans to own homes.

UAP Insurance and S&L, which is the mortgage arm of the Kenya Commercial Bank Group entered into a partnership on Thursday that will see their borrowers covered against retrenchment and social risks.

“If unfortunate circumstances such as a riots or political issues affected your property, you can rest assured that the house will be paid for in full. This cover will come to give you the comfort that there is someone taking care of your mortgage payment,” said S&L Managing Director Caroline Kariuki of the Retrenchment Covers.

Through the partnership S&L’s customers can still have their mortgage payments settled by UAP for up to nine months after they are laid off.

The conventional mortgage covers, she observed, do not anticipate emerging business threats such as involuntary retrenchment that many people have to grapple with particularly in the harsh economic environment.

The product will be available to mortgage and business clients with properties that have a maximum value of Sh300 million each. New customers will automatically enjoy the benefit of the cover

“An existing customer will only have to make a small additional monthly premium and will enjoy the new benefits from the renewable date,” Mrs Kariuki said of the nominal charges which amounts to 0.1 percent of the value of the mortgage per annum

Another product ‘Social Perils Cover’ would come in handy especially as people seek protection against loss or destruction of property from riots, strikes and political conflicts such as the one experienced last year.

UAP Managing Director James Wambugu explained that having such partnerships would help increase the uptake of insurance which stands at about six percent.

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“We have been challenged as an industry to go out and increase insurance penetration but the only way to do that is to start giving people the products that resonate with the needs that they have,” he said.

Such collaboration would go a long way in deepening the financial sector which has been identified as one of the key sectors expected to drive Vision 2030, the two partners said.

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