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Daily Nation : February 25th 2014
DAILY NATION Tuesday February 25, 2014 insurance Want lavish wedding? Buy insurance policy Forget taking huge loans. A new plan by insurers will enable young people to save for a dream ceremony to tie the knot, buy house or top of the range car BY MWANIKI WAHOME @mwanikiwahome T email@example.com he youth might soon be able to save for that dream wedding, or sleek car, if a plan by the insurance industry is realised. The objective of the new cam- paign is to increase the number of people buying insurance. The Association of Kenya In- surers (AKI) is leading a drive that will see more products introduced in the market to meet needs that are dear to the youth. The push is informed by find- ings of a study conducted by SBO Research last year which noted that many youth lacked information on the insurance industry. Although the youth appreciate the role of insurance, they associate it with the rich, the study found out. The report noted that insur- ance products in the market did not meet immediate needs of the youth, such as funding a dream wedding, graduation ceremony, furthering education and buying treasured items such as a dream smart company 5 REPORT » YOUNG PEOPLE APPRECIATE COVER BUT ASSOCIATE IT WITH THE RICH, REVEALS STUDY FILE | NATION Association of Kenya Insurers chairman Mark Obuya. The association is leading a campaign for new insurance products that meet specific needs of the youth. car or house. The youth said insurance prod- ucts that are important to them are those that would enable them save for short-term goals. Industry players say insurance products targeting the youth should have a cash benefit component to meet their needs. Besides, the players say for the insurance industry to attract the youth — people aged 15 to 35 years — it has to develop products that resonate with them. “The Insurance Regulatory Authority has been urging the industry to innovate products that are tailor-made for various segments of the market,” said the authority’s chief executive Sammy Makove. “There is no place for straightjacket insurance products that 15pc Estimates by the telecom industry show that more than two million youth in Kenya use the Internet and are active in social media platforms, mainly Facebook and Twitter. Insurance firms can therefore reap big by using social sites to advertise their products. Some insurers are already exploiting new media to drive uptake of new products. Kenya Orient Insurance Company, for instance, is offering a cover against loss or damage of smartphones. The premiums are paid using a code. Appealing messages Some of the methods pro- fit all because different classes of people have different needs. We, as the regulator, will approve any of the products that meet the standards required.” The insurers, Mr Makove said, Percentage annual jump of insurance industry in Kenya. The sector has lagged behind in growth compared with other financial industries have to come up with affordable and flexible products which take into consideration the unreliability of the youth’s income. Analysts say insurers have to use mobile money transfer platforms for payment of premiums and extensively use the social media to advertise their products in order to attract the attention of the youth. “The new initiative has the ob- jective of growing the market for insurance products by having the youth understand their role in the financial wellbeing of the society,” said AKI chairman Mark Obuya. “We shall embrace new trends in society to enable more youth to take up insurance by developing products that are relevant to them and delivering them through their most convenient channels.” posed to attract the youth include extensive use of appealing messages delivered through the social media, offering internship in insurance companies, use of specialised agents and organising open days and seminars to create awareness. The insurance industry in Kenya has been growing, albeit slowly, registering a 15 per cent jump annually, with the penetration standing at 3.01 per cent last year. The sector has, however, lagged behind even as other financial industries record growth in tandem with the expanding economy. This has resulted in the in- dustry being dubbed “the dark house” among financial institutions.
February 24th 2014
February 26th 2014