NAIROBI, Kenya, Jan 22 – More Kenyans are set to access medical insurance through an affordable micro-insurance health cover that targets low income earners.
The cover jointly launched on Wednesday by British American Investments (BRITAM), Changamka Micro Insurance and Safaricom Limited provides a family medical cover at an annual subscription of Sh12,000 for a cover valued at Sh290,000.
The product dubbed Linda Jamii will cater for in and out-patient, maternity, dental, optical and a hospitalisation income replacement benefit of Sh500 per day to take care of lost income while in hospital, and funeral expenses in case of death.
The product has been running in Nairobi only and will be launched countrywide with over 600 hospitals accessible through it with plans to grow to 1,000 hospitals by the end of the year.
Birtam Managing Director Benson Wairegi said the company targets to cover over one million people by the end of the year which will increase business value by 50 percent.
“In addition to providing this service, we will have the opportunity which we can plough back into the business. Our current premium at the moment is about Sh10 billion and we hope to get Sh10 billion more this year, that’s about 50 percent increment, it’s a line of business with enormous potential,” he said.
The investment company projects that the product will bring in Sh50 billion in the next five years.
“In the early years of the policy we will not make tones of money, but as you continue with the take up the premiums grow, we have made investments in the infrastructure then we will start making money in the next three years,” he explained.
The product has adopted a micro saving model which will use M-PESA as the premium collection platform and covers persons from the age 18 to 75 years at entry, children under 18 years are also covered through their parents.
“One can pay premiums in installments through M-PESA and can access partial benefits after accumulating Sh6,000 in contribution,” said Safaricom Chief Executive Officer Bob Collymore.
Only three percent of the Kenyan population has health insurance – mainly employer-based policy – meaning about 38.8 million Kenyans have no health insurance.
Britam recorded a 25 percent increase in its half year pre-tax profit for the period ending June 30, 2013 to Sh2.3 billion from Sh1.8 billion over the same period in 2012 backed by new business growth along with investment gains.
Earnings per share increased by 22.6 percent from 93 cents per share in June 2012 to Sh1.14 per share for the first half period in 2013 with Insurance business revenue grew to Sh4.4 billion compared Sh3.4 billion during a similar period in 2012.