UAP - OLD MUTUAL MicroInsurance Brief

Transcription

1 UAP - OLD MUTUAL MicroInsurance Brief BECOMING AFRICA S FINANCIAL SERVICES CHAMPION WHERE WE ARE WHERE WE ASPIRE TO BE COUNTRY : KENYA BUSINESS LINE: GENERAL INSURANCE 0

2 Content n UAP Microinsurance Basic Design & Experience 1. AfyaKamili 2. SalamaSure 3. Kilimo Salama n Successes factors and Challenges n Key Success factor for future growth 1

3 AfyaKamili Micro Health Insurance Product Value Proposition: Full payment Inpatient and Surgical procedures, no co-pays. Flexible premium payment plans. (Two Options) IPF (With Financiers) Installments: up to 10 monthly installments Savings For Health: Mobile wallet(msa) allows you to save for cover. Affordable cover irrespective of the family size. From Kes 4,000 Per Year, 300 Per Month Cash Back: Outpatient under member savings account; unutilized money rolled over. Outpatient can be topped up, -MSA - MPesa style 2

4 AfyaKamili - Product Structure Inpatient: Supplementary Inpatient cover: Covers for Surgical Claims Pays for co-pays of the all surgical procedures up to Kes 15,000 Pays for 50% Dialysis procedure for each event up to Kes 2,500 at referral hospitals only. Personal Accident Cover Kshs 50, 000 Funeral expense for both Principal Member and/ or Spouse of Kes 50, 000 due to illness or accident. Total Permanent Disability-Kes. 50, 000. Outpatient cover Member s savings account Min. Kes. 5, 000. The cost of consultation, diagnosis and medication is drawn from the member s savings account (MSA). This amount is refundable / rolled over to the next period when unutilized. (Unutilized money back guarantee). Savings on mobile health wallet This component is provided by NHIF The benefit pays all inpatient hospitalization treatments due to illness. NHIF pays for surgical procedures net of co-payment of Kes. 15,000. Dialysis at referral hospitals payable up to 50%, Max Kes.2, 500. One MUST have a valid NHIF card

5 AfyaKamili Experience Sales - Three months pilot covered Approx.. 1,350 people Claims Experience Commendable ; less than 25%. Aggregators distribution worked The challenges common to micro insurance are not unique to this market but their sensitivity to success is higher than the convectional insurance market Clientele included corporate schemes for low category employees and self sponsored individuals. High signups during campaigns and activations and convention channels are interested to distribute micro products Product development needs to bear in mind behavioral economics of targeted low end market clientele. Supplementary cover and partnerships between private sector, public sector have a place in successful product distribution. Presentation Title : OMEM IT Page 4

6 AfyaKamili Factors That Attributed to Success and Challenges Factors that Attributed to Success Aggressive Marketing and Communication- Activations, Testimonials campaign - ; White labelling, Opinion leaders Aggregator & Affinity model; Distribution partners UNAITAS, MobiKover Adopting Technology for product Administration (sign up, claims etc.) and Distribution, Factors that Attributed to Challenges Limited / inadequate Partners Medical Service providers Limited Insurance principle and practice knowledge among clients and MSP High rate of lapses policies Fraud among clients and MSP Presentation Title : OMEM IT Page 5

7 CONTENT UAP Microinsurance Basic Design & Experience 1. AfyaKamili 2. SalamaSure 3. Kilimo Salama n Successes factors and Challenges n Key Success factor for future growth 6

8 SALAMASURE MICRO PERSONAL ACCIDENT INSURANCE PRODUCT Dial *827# from your Safaricom line View Cover Options Register & Purchase Policy Report a Claim View Account Scope of Cover Accidental loss of life. Accidental permanent total disability. Medical expenses incurred as a result of accidental injury Payment of a final benefit for purposes of organizing funeral expenses. Cost of artificial appliances PRESENTATION TITLE 1. Product design Simple, Understandable, accessible, & efficient 2.Prototype design & Pilot testing testing- key success factor 3.UAP brand positioning - technology innovation in insurance

9 CONTENT UAP Microinsurance Basic Design & Experience 1. AfyaKamili 2. SalamaSure 3. Kilimo Salama n Key Success factor for future growth 8

10 THE MANDATE OF KILIMO SALAMA Develop and implement agricultural insurance products for smallholder farmers 9

11 Traditional Insurance PRESENTATION TITLE Large scale farm: US$ 1000 Premium - US$ 50 Visit Costs + US$950, insure Small scale farm: US$ 10 Premium - US$ 50 Visit Costs - US$ 40, can t insure

12 We don t visit the farm PRESENTATION TITLE Weather station, district yield data or satellite data + agronomic formula s to model required rainfall Using rainfall data, a pattern is drawn and a perfect future is predicted which if arrived at the farmers targeted farmers will be able to harvest satisfactorily for both home consumption and some surplus to the market. When the complementary event happen, indemnification start in proportion to the magnitude of shortfall.

13 PRESENTATION TITLE KILIMO SALAMA VALUE CHAIN 12

14 END TO END OPERATION REVIEW PRESENTATION TITLE Claims payment. Season outcome analysis and communication to the customer Cover commencement and M&E Communication to the customer acceptance and premium payment through MNOs Reinsurance arrangement Index design & incorporation in a policy Needs assessment 13

15 PRESENTATION TITLE KILIMO SALAMA EXPERIENCE Cumulatively, by 2015, over 800,000 farmers in Kenya, Tanzania and Rwanda insured over 646 million USD against a variety of weather risks. Crops insured include maize, sorghum, coffee, sun -flower, wheat, and potato, with coverage against drought, excess rain and storms. 14 Distribution channels: seed distribution linked to a mobile network operator s location service, agribusinesses with outgrowers or contracted farmers, lending institutions and savings and credit cooperatives (SACCOs) providing input loans, and medium-scale professional farmers.

16 KILIMO SALAMA CHALLENGES. Aggregators - Delay in releasing loan results in yield losses, Farmers default when they know that there is insurance and Banks focus: we want our credit repaid Basis Risk- There is data gaps in most of the Historical data for the last 30 years. In some cases the data quality is not high. Both cases comprise the index precision. The positioning of the farmer relative to the weather station is sometimes remote leading to a mismatch in the outcome of index and the true production. We have tried to resolve this through a hybrid solution where one component is an MPCI. Nevertheless this remain a challenge and in many cases we pay some farmers on ex-gratia basis. Critical Mass We are yet to reach a critical mass where the solution can run on its own without external funding. We have relooked into the initial idea of insuring small scale to medium scale farmers

17 CONTENT UAP Microinsurance Basic Design & Experience 1. AfyaKamili 2. SalamaSure 3. Kilimo Salama n Key Success factor for future growth 16

18 KEY SUCCESS FACTOR FOR FUTURE GROWTH Conducive regulatory environment / micro insurance policy / framework Collaboration between private insurers, government/ quasi government institutions including public sector and NGOS focused on healthcare and agriculture funding. Leveraging on mobile technology: Innovations around the growing mobile technology industry to drive distribution and operational excellence. This will in turn lower the cost of distribution and administration costs. Strategic and innovative product development: Product development models should have a bias on behavioral economics. In depth longitudinal research to study consumer behaviors and create propositions around the consumer lives. Customer centricity behavior focused on winning customers/ the masses and not pushing products. Good definition of customer journey and experience mapping through the entire life cycle. 17

19 Thank you