From East African Business Week
In the midst of a drought-induced food crisis affecting millions in the Horn of Africa, an innovative insurance programme for poor livestock keepers is making its first payouts today, providing compensation for some 650 insured herders in northern Kenya’s vast Marsabit District who have lost up to a third of their animals.
Known as Index Based Livestock Insurance or IBLI, payouts are triggered when satellite images show that grazing lands in the region have deteriorated to the point that herders are expected to be losing more than 15% of their herd. The current readings for which indemnities are now being paid show that between 18 and 33% of livestock have been lost to drought this season.
“It’s terrible that we are seeing this level of loss, but gratifying that the policies are doing what they are supposed to do, which is to help herders avert disaster when weather conditions dry up pasture lands and animals begin to perish,” said Isaac Magina, head of agriculture insurance at UAP Insurance Ltd.
“When you look at a 33 % loss, that is a significant portion of the asset base of any business and it would be difficult to survive without insurance,” added Magina.
The insurance project was developed in partnership by the Nairobi-based International Livestock Research Institute (ILRI), Cornell University and the Index Insurance Innovation Initiative (I4) programme at the University of California at Davis. Commercial partners Equity Bank and UAP Insurance Ltd. implement the programme. The IBLI project is funded by USAID, the European Union, the British Government, the World Bank, the In the midst of a drought-induced food crisis affecting millions in the Horn of Africa, an innovative insurance programme for poor livestock keepers is making its first payouts today, providing compensation for some 650 insured herders in northern Kenya’s vast Marsabit District who have lost up to a third of their animals. and the Global Index Insurance Facility.
The Marsabit District alone is home to some 86,000 cattle and two million goats and sheep that generate millions of dollars in milk and other products and serve as the main source of sustenance and income. ILRI estimates that up to one-third of all livestock in the region have perished during the current drought.
In East Africa, an estimated 70 million people live in the drylands, and many of them are herders. In Kenya, the value of the pastoral livestock sector is estimated to be worth US$800 million.
And the Intergovernmental Authority on Development in Eastern Africa, which takes a regional approach to combating drought in six countries of the Horn, estimates that over 90 % of the meat consumed in East Africa comes from pastoral herds.
Under the terms of the policy, insured herders are compensated for any losses above 15 %, with the 15 % threshold acting as a sort of deductible. For example, a cattle herder who lives in an area with a livestock mortality rate of 33 % receives a payout covering 18 % of his or her animals.
With cattle valued at about Kshs15,000 (about US$150), an insurance policy covering 10 animals, or 150,000 Ksh in cattle, would pay out at about Ksh27,000 (about US$270).
When the 15 % deductible is factored in, compensation ranges from 3% in areas where the drought has been more moderate to 18 % in the areas where herders were hit particularly hard. But in an indication of the severity of the drought, all of the areas where the policies were sold have exceeded the 15 % mortality threshold that triggers a payout.
Thus far, the policies cover about 1,100 animals – mostly cattle, but some goats and sheep and a few camels, as well. The payments are being dispatched in the middle of a humanitarian crisis endangering 12 million people in the Horn that is prompting a call for new ways to manage food security risks in East Africa’s arid drylands.
For example, a recent report from ILRI has found that the pastoral approach to livestock production, in which herders make do with marginal lands by regularly moving their herds, could be very effective at averting weather-related food shortages. ILRI experts believe that in arid and semi-arid regions, keeping livestock could be a more effective coping strategy than cultivating crops – if herders have options for reducing their vulnerability to drought.
“Drought insurance is one important way to help livestock keepers maintain food security even in very harsh environments,” said Andrew Mude, the IBLI project leader at ILRI. “Insurance is not by itself sufficient,” he added, “But if it is accompanied by other risk-reducing strategies, such as better access to grazing lands and watering areas, then the pastoralist approach, which some people dismiss as a backward lifestyle of the past, emerges as a very effective way to meet future food needs.”
Mude said that it is too early to tell just how the payouts from the policies will affect food security and other welfare indicators. For example, it’s not yet clear how many herders will use the compensation to replace animals lost to the drought. But Mude said one major success thus far is that the livestock mortality index that is at the heart of the programme appears to be working.
The fatality rate predicted by the satellite assessments of forage loss is tracking very closely surveys of animal deaths on the ground. That’s crucial because using freely available satellite images of pasture lands to accurately predict animal deaths overcomes a major barrier that has bedeviled past efforts to provide livestock insurance in poor regions: the prohibitively high costs and logistics of confirming animal deaths in herds that roam across vast distances in extremely remote areas.
UAP Insurance, Syngenta Foundation, Safaricom expand insurance plan to cover value of farm harvests, more crops to provide safety net for Kenya farmers
With Kenyan farmers increasingly fearing massive weather-related losses, UAP Insurance, Syngenta Foundation and mobile operator Safaricom announced today a major expansion of Kilimo Salama, an innovative and affordable crop insurance program that will now cover the expected value of farm harvests, more crops and many more farmers against drought and flooding, while also protecting against livestock losses.
The new program, called Kilimo Salama Plus, builds on the original Kilimo Salama—Kiswahili for “safe farming”—which was launched last year. It uses a low-cost mobile phone payment and data system that is linked to solar-powered weather stations to issue an insurance policy and rapidly compensate farmers for investments in seeds, fertilizer, and other inputs that are lost to either insufficient or excessive rains.
Kilimo Salama Plus retains this innovative approach while expanding from the initial focus to go beyond just inputs to give farmers the opportunity to insure the value of their harvest. In addition, due to high demand, farmers can now insure a wider array of crops including maize, wheat, beans, and sorghum.
Kilimo Salama Plus is available to farmers in the productive breadbasket regions of Southern Nyanza, covering Oyugis and Homa Bay, Busia and Northern Rift, including Kitale and Eldoret, as well as Embu and Nanyuki.
UAP Insurance Managing Director James Wambugu said that Kilimo Salama Plus had expanded the range of crops under cover due to rising popularity of its affordable and easily-dispensable nature.
“It also follows our drive to simplify insurance and in the process expand access to more crop and livestock farmers,” he explained.
“Agricultural insurance is particularly important in Kenya and elsewhere in Africa today as the extreme weather patterns generated by climate change are introducing greater volatility to food production and food prices,” said Dr. Wilson Songa, Agriculture Secretary of the Minister of Agriculture, during the launch ceremony in Kitale today.
Expounding on the successes of the initial program, Marco Ferroni, Executive Director of the Syngenta Foundation, said, “We have seen 12,000 farmers in Kenya take advantage of the original Kilimo Salama and we should be able to reach 50,000 farmers with Kilimo Salama Plus this year and provide far more insurance options.”
“We have quickly seen this initiative grow from a small pilot program in 2009 to become the largest agricultural insurance program in Africa and the first to use mobile phone technology to speed access and payouts to rural farmers,” he added.
Just as they did with the original program, farmers purchase Kilimo Salama Plus through local agro-dealers, who use a camera phone to scan a special bar code that sends the policy to UAP over Safaricom’s mobile data network. This innovative mobile phone application, which was developed by the Syngenta Foundation, then sends a text (SMS) message to the farmer’s mobile phone confirming the insurance policy.
Payouts are determined by data collected through 30 weather stations in the targeted regions that have been renovated with automated, solar-powered systems capable of broadcasting regular updates on weather conditions and rainfall quantities occurring near individual farms. When data from a particular station, which is transmitted over Safaricom’s 3G data network, indicates that drought or other extreme conditions (including excessive rains) are destined to reduce yields, all farmers registered with that station automatically receive payouts.
The payments are sent directly to a farmer’s mobile phone via Safaricom’s popular M-PESA mobile money transfer service. Using M-PESA combined with the automated weather stations allows farmers to quickly collect payouts with virtually no claims process and no need for an agent to visit the farm to confirm losses.
“M-PESA is already a well-established and trusted system for conducting money transfers in rural Kenya and our network has more than enough capacity to provide greater access to the Kilimo Salama Plus program,” said Safaricom CEO Bob Collymore. “It is exciting to see how the rapid uptake of mobile phone technology in Kenya, bolstered by Safaricom’s pioneering investment in M-PESA and a robust data network running on Kenya’s only 3G platform, is being used to deal with the weather uncertainties that are a major cause of food insecurity among some Kenyan families.”
Included in the program is a helpline funded by the Syngenta Foundation that is staffed by agriculture experts from Safaricom offering farmers free advice on how to improve production and protect their investments. Sixteen thousand Kenyan farmers already have used the helpline.
Crop insurance has long been used in developed countries to deal with such weather uncertainties, but its availability in Africa, particularly to smallholder farmers, has been extremely limited. Many areas of Kenya received far less rain during the “short-rain” season that runs from October to December and there are concerns that weather patterns now developing—particularly a cooling of Pacific Ocean waters known as “La Niña”—could curtail precipitation throughout 2011. Kilimo Salama partners expect for some registered farmers in parts of Embu, Nyanza, and Nanyuki to receive payouts for drought-related losses.
Kilimo Salama (“Safe Agriculture”) is a pay-as-you-plant insurance program for Kenyan farmers to insure their farm inputs against drought and excess rain. The program, which is a partnership between Syngenta Foundation for Sustainable Agriculture, UAP Insurance, and Safaricom, uses a low-cost mobile phone payment and data system that is linked to solar powered weather stations to issue insurance policies and rapidly compensate farmers for investments in seeds, fertilizer, and other inputs that are lost due to either insufficient or excessive rains. Kilimo Salama is supported by the International Finance Corporation (IFC) and Syngenta Foundation for Sustainable Agriculture.
From MicroEnsure -
IFC, a member of the World Bank Group, today signed agreements with three partners to expand access to insurance to thousands of farmers and livestock herders in Kenya and Rwanda to help protect their crops, animals, and livelihoods from weather-related risks and natural disasters.
IFC, through the Global Index Insurance Facility (GIIF), will confer grants totalling roughly $4.1 million to the Syngenta Foundation for Sustainable Agriculture/UAP Insurance weather index insurance initiative in Kenya; the International Livestock Research Institute (ILRI) Livestock index insurance project in northern Kenya; and the MicroEnsure weather index insurance project in Rwanda.
The grants, the first three provided under the GIIF program, will help bring weather-related, index-based insurance to about 35,000 farmers and 5,000 livestock herders in East Africa over the next three years.
Jean Philippe Prosper, IFC Director for Eastern and Southern Africa, said, “These partnerships highlight IFC’s commitment to expanding insurance and other financial products where they are needed most in Africa. The Global Index Insurance Facility will facilitate farmers’ access to credit, leading to increased productivity, improved livelihoods and greater food security. We are grateful to the donors that have generously provided funding and to our partners for supporting this program.”
Bernard Rey, the Head of Operations European Union Delegation to Kenya, said, “The implementation of these three first GIIF projects in Kenya and Rwanda will support the development of new insurance products and will increase expertise in this field, which will benefit smallholders and livestock keepers affected by climatic events. In addition to the GIIF, The European Union is providing further financing to the ILRI Livestock Insurance project in Kenya through the 10th European Development Fund, Kenya Rural Development Project that will start in 2011.”
The specific grant agreements are:
- IFC will confer a grant of up to $2.4 million on Syngenta Foundation for Sustainable Agriculture, which expects to help insure 20,000 farmers in Kenya over the next three years
- IFC will confer a grant of up to $154,000 on the ILRI, which expects to help insure 5,000 livestock herders in northern Kenya over the next two years.
- IFC will confer a grant of up to $1.6 million on MicroEnsure, which expects to insure 15,000 farmers in Rwanda over the next three years.
IFC’s GIIF program was established in 2009 to assist the development of index-based insurance for natural disasters and weather risks in developing countries, where insurance is rarely available.
The grants will fund advisory activities, including local capacity building, infrastructure development, product development, and development of local insurance companies’ capacity to provide index-based insurance products.
Index-based insurance insures against catastrophic events, such as wind storms or droughts, depending on their severity. Index-linked insurance products eliminate the need for insurance companies to individually verify claims, reducing transaction costs and making it easier for the products and services to be offered to rural communities and in frontier regions.
The European Union committed 24.5 million Euros as the first donor to the GIIF Trust Fund. The fund is also supported by Japan’s Ministry of Finance with an initial grant of $2 million, and the Dutch Ministry of Foreign Affairs, which provided funding to establish the facility.
By Mwangi Muiruri, Daily Nation Kenya -
No one took them seriously but it appears small-scale farmers are now digging in for a big stake in the insurance industry. The introduction of insurance cover for crop failure promises to give farmers not only control of their farming, but could also turn them into a niche market for insurance companies groping for clients is a near-stagnant market.
The micro-insurance cover was pioneered in Kenya through a collaboration between Syngenta Foundation for Sustainable Agriculture, UAP Insurance, Safaricom and 54 local agro-vets.
Under the programme, too, are 30 weather stations, each covering a micro-climate of a maximum of 15-20km radius.
Suppliers sponsor half of the premium’s price, leaving farmers to pay 5 per cent on top of the cost of the inputs. The product debuted in Kenya in 2009 with a pilot project in Laikipia district. Ms Rose Goslinga, the project’s coordinator, says it involved 700 maize farmers who were insured against drought.
“Following the drought that hit them, all farmers were compensated depending on the extent of the drought,” she says.
The programme has partnered with agro-vets across the country and serves 11,000 farmers spread across Western Kenya, Southern Nyanza, Uashin Gishu, Embu, and Laikipia East.
Analysts say the Insurance Regulatory Authority should amendment law to accommodate this new scheme. Through micro-insurance, most farmers who find mainstream cover unaffordable will have one reason to farm more and improve food security in the country.
In 2007, Kenya FinAccess found that 69 per cent of Kenyans find insurance unaffordable. Ms Jayne Gathii, who is in charge of agri-business for marginalised women groups at the Kenya Agricultural Research Institute (KARI), says micro-insurance will cultivate confidence in farming.
“Unpredictable rains that occasion crop failure define the lives of smallholder farmers. Good years are remembered for their adequate rains, while bad years are defined by droughts or other adverse weather conditions,” she says.
Ms Gathii says agricultural micro-insurance will reduce the impact of severe weather and support increased investment in productivity.
“Insured farmers are able to buy certified seeds and invest in fertilisers. In the years following droughts, insured farmers are able to continue farming,” she says.
Agriculture Secretary Wilson Songa says legislation has to be fast-tracked to widen the scope of farmers’ access to insurance.
“Traditional agricultural insurance relies on on-farm monitoring of losses, evaluated through farm inspections. And since the transaction costs to insure one acre are similar to insuring a 200-acre farm, the premiums from the one acre farm would never cover the related transaction costs,” he says.
He roots for weather index based insurance generated through strategically placed weather stations that give a clear picture of draught risks.
“The weather stations measure the rainfall and these measurements are compared to an agronomic model specifying crops’ rainfall needs. If the needs are not met, farmers insured under that station receive a payout. If the needs are met,” he says.
He says this approach is working in Mexico, Morocco, India, Malawi, Rwanda and Tanzania, among other countries. But Mr Songa says farmers will be trained on micro-insurance schemes.
Syngenta Foundation chief executive Fritz Brugger says the programme has its risks, mostly related to poor takeoff.
From Medical Daily -
Jane Gathoni, a Kenyan farmer was pleasantly surprised when she received a text message from the African micro-insurance provider UAP saying she had been compensated with $29 for loss of her harvest due to drought.
Gathoni, a mother of two and caretaker of two orphans is one of the more than 9, 500 Kenyan famers who have been micro-insured. She has been farming for the past 11 years on 2 acres (0.8 hectare) of land in Kenya and joined a program that assess crop loss and subsequently pays compensations based on climatic data from solar powered weather stations. She used her insurance money to buy new seeds.
The scheme Kilimo Salama—a Swahili phrase that means “safe farming” was launched in 2009 and gives small-scale farmers in Kenya “pay as you plant” insurance. This saves thousands of farmers who lose their harvest often and can’t afford to buy seeds next season.
African farmers depend largely on rain. Harvests have been adversely affected in the past few decades because of sharp depletion of nutrients in the soil. According to Keith Shepherd, a soil scientist with the Nairobi-based World Agroforestry Centre, this is due to rampant mining activities. Experts say the situation deteriorates due to unreliable weather patterns.
UAP managing director James Wambugu believes that this revolutionary scheme would make micro-insurance accessible to farmers by using the weather stations to verify local weather conditions. It also can help micro-insurance to become affordable and attractive for small farmers.
Insured farmers pay an extra 5 percent of the value of high-yielding seeds, chemicals, and fertilizers sold by agricultural companies who are partners with UAP. These companies match the farmers’ investment to cover the full 10 percent premium it takes to cover the program’s cost.
Switzerland-based Syngenta Foundation for Sustainable Agriculture and Kenyan mobile phone service provider Safaricom are also partners in the scheme. When a farmer buys supplies from one of the two companies, an employee uses a camera-enabled mobile phone to scan a special bar code which immediately registers the policy with UAP Insurance through Safaricom’s network.
A customized mobile phone application developed by the Syngenta foundation then sends a text message to the farmer’s mobile phone confirming the insurance policy. The scheme is expected to reach a potential 50,000 Kenyan farmers in near future.
By Victor Juma, Business Daily –
The sale of insurance products through the mobile phone has opened a new door for the sector to roll out cheap products expected to spur growth in the Kenyan market.
The technology is set to cut the high administration costs that made it difficult for local firms to enter the micro insurance market that has been tipped to deepen insurance penetration, which has remained at a mere 2.5 per cent of the population for nearly a decade.
Micro insurance offers risk cover to the poor with its main features being small amounts of premiums paid by policy holders.
Equity Bank and Safaricom have launched a mobile based platform that allows consumers to make payments, which are as low as Sh530 annually or Sh10.2 weekly, that local insurance firms are hoping will help them capture the low end of the market.
The mobile-based payment is set reduce the insurers wage bill and distributions costs such as running branches and agents commissions, which are insurers’ biggest cost item.
“Collection of insurance premiums and payment of claims is one of the major challenges of the insurance sector and the ability to do these through mobiles will cut costs and reduce customer inconvenience,” said Joseph Kameri, the marketing and distribution manager at UAP.
He added that savings brought by the mobile based payment system will in turn create headroom for lowering the cost of insurance products, especially those targeted at the low end market.
Analysts say that the service will help in taking micro insurance to the bottom end of the market where they are needed the most but where insurance firms find it too expensive to operate because of thin volumes.
The low insurance penetration has been blamed low confidence in insurance products and lack of products targeted at the low and mid-end niches.
This has seen the local insurance sector perform dismally compared to its peers in the financial industry notably the banking sector.
“Micro insurance presents a major growth opportunity for the insurance industry in Kenya because it is inclusive of most of the population,” says Ashok Shah, the managing director of APA Insurance.
The entry into the down market is not only expected to guarantee a steady stream of earnings for these firms, but also offer an opportunity for individuals and SMEs to be roped into the insurance bracket.
In doing so, local insurers will be following in the footsteps of the banking sector that went down-market in 2003 — leading to sharp a growth in the sector.
Banks have seen pre-tax profits grow from Sh7.1 billion in 2004 to Sh24.6 billion in 2008 compared to that of the insurance sector that dropped from Sh1 billion to Sh500 million over the same period.
Already, local insurance firms are angling to be part of the Equity-Safaricom deal, egged on by the large number of Equity and Safaricom clients who are uninsured.
Equity bank has 4.5 million account holders while Safaricom’s Mpesa—the platform for making the premium payments—has 8.5 million subscribers, offering a ripe niche for micro-insurance.
“We have short listed eight of the leading insurance companies. And after competitive bidding, we will channel the insurance business to the best suited insurer to provide a specific cover,” said James Mwangi, Equity bank CEO.
The bank is set to earn commissions for the insurance products and tap into hundreds of millions of shillings in deposits as it is likely to act as the bankers for the selected insurance firms.
Last year, Equity Bank recorded a turnover of Sh1.2 billion from its bancassurance (the selling of insurance products through the bank) unit— from selling health, life and personal accident insurance covers provided by UAP and Britak.
“The bank’s marriage with Safaricom is likely to increase the uptake of micro insurance judging from the previous performance of Equity’s bancassurance,” said Isaac Ngaru, an insurance consultant with Ng’aru & Associates.
Business Daily/All Africa Global Media via COMTEX —
British American Insurance has launched a new personal accident insurance product whose premiums will be paid through the recently launched M-Kesho Account.
The new product, to cost Sh530 per year or staggered monthly payments of Sh69.17 or weekly payments of about Sh20, is a micro-insurance product that is likely to increase the pace of innovation in the insurance industry, which is struggling to increase penetration.
The company’s personal insurance business is the fourth largest in Kenya (Sh475 million), behind APA Insurance at Sh1.9 billion, UAP Insurance at Sh714.7 million and CFC Life at Sh631.2 million, based on 2008 financial statistics.
Some insurance industry players who requested anonymity, for fear of being perceived as undermining the new product, said they were worried that it could pull in a significant number of their personal accident business and make major gains in the search for new clients, starving other insurers of new policy sales.
British American Insurance (Britak), however, downplayed the concerns.
“This is a product that could drive innovation in the industry. Every insurance company is looking at what areas it can have a head start in,” said Stephen Wandera, the managing director of Britak
The product’s features like low premium, low monthly payments, application and premium payment over the mobile phone combines most of the qualities that have been identified as critical in the success of micro-insurance product of its nature.
A study commissioned by the Association of Kenya Insurers (AKI) in 2008 identified the need for low cost insurance products as a major possible driver of insurance services’ growth in Kenya.
As a result, several insurance companies have come up with low cost insurance products that have had mixed performance in the economy.
Kenya Orient Insurance Company launched a 24-hour personal accident cover in 2008 that costs Sh30 and is traded over the mobile phone.
It is not clear how that product has performed in the market.
Others like CIC Insurance, the pioneering micro insurance company in Kenya said its array of micro insurance products contributed Sh400 million to its overall Sh2.8 billion gross premiums.
Others who have made gains from micro insurance precuts include UAP Insurance and Mercantile Insurance companies.
Insurance penetration in Kenya is dismal, with general insurance averaging 1.7 per cent according to the AKI data of 2008 while combined general and life insurance have penetration of 2.63 per cent.
The new product will have a death benefit of Sh150,000, a similar financial benefit for permanent disability, Sh30,000 for medical cover and Sh20,000 for the last expense – to take care of funeral expenses.
“M-Kesho is a major win for micro insurance because it makes it easy to reach the bottom end of the market,” said Steve Mainda, the chairman of the Insurance Regulatory Authority.
The new product could set Britak as one of the major players in the personal accident business if the product is well marketed.
Already, the product enjoys the opportunity in numbers because of the nine million M-PESA subscribers, as some could buy the product.
It will also gain from the 17,000 M-Pesa agents who could be empowered to market the product.
By Steve Mbogo, Business Daily Africa –
Insurance companies are cashing in on the low-end market as more Kenyans take covers.
CIC Insurance is among key beneficiaries making financial gains from low-income earners, a target group that a number of insurers are warming to as they seek new revenue streams in an industry that has witnessed near stagnant growth.
The insurer’s revenue from micro insurance accounted for 15 per cent of its gross premiums in 2009, about Sh400 million out of a total of Sh2.8 billion gross premiums.
“It is a significant revenue contribution” said Nelson Kuria, CIC chief executive.
The company is the pioneer of micro insurance in Kenya and has played the reference role to other companies on whether the micro insurance business is sustainable.
The co-operatives’ insurer increased its pre-tax profit by 26 per cent to Sh277 million in 2009 from Sh219 million in 2008 while assets increased by 16 per cent to Sh3.5 billion in 2009 from Sh3 billion in 2008.
The revenue growth is likely to increase interest beyond the four companies now underwriting micro insurance in Kenya including British American, UAP and Apollo Insurance.
UAP Insurance said its business grew 25 per cent in 2009, mainly because of the increase in sale of micro insurance products. However, specific figures were not available.
“Micro insurance is still [more or less] on trial stage and we have barely scratched the surface,” said James Wambugu, the CEO of UAP Insurance.
British American Insurance Company said it is betting on micro insurance to grow business and diversify from the traditional insurance products.
“For us, the revenue contribution in 2009 from micro insurance was not significant because we are yet to exhaust our marketing,” said James Irungu, the micro insurance manager at British American.
He attributed its revenue contributions to one per cent of the total gross premiums in 2009.
“There is a slowdown in growth of revenues because of the sensitive nature of marketing micro insurance. It requires dedicated time to build relationships with clients,” he said.
Marketing micro insurance requires that products are developed to suit organised groups like farmers or casual workers to knock out the high cost of administration for low priced products and win higher numbers with a single sale.
CIC Insurance for example has partnered with micro finance insurance group the Kenya Women Finance Trust and the National Hospital Insurance Fund to embed its products in products like micro-business loans lent to masses.
Apollo Insurance has adopted a similar marketing concept while UAP Insurance is selling to micro insurance to farmers – for farm input insurance cover through the agro-dealers where farmers buy their inputs.
Increasing revenues from sale of micro insurance products has opened a new opportunity for insurance companies to increase their penetration into the population and contribution to the gross domestic product.
A recent report by the Association of Kenya Insurers found that micro insurance offers the greatest opportunity for the industry to reach a wider population and contribute to easing poverty.
The development will also help ease cut-throat competition that has led to price undercutting in the insurance industry.