The role of insurance in weathering COVID-19 pandemic [Video]

Since the advent of the coronavirus (COVID-19) pandemic in Kenya, it has had a huge impact on people’s lives, families and communities. For Kenya’s insurance industry, the fallout from the pandemic has resulted in an increased number of health, travel and business interruption claims coupled with reduced sales volumes and fewer face-to-face interactions with customers.

At the same time, COVID-19 could also be a turning point for the insurance industry and enable insurers to demonstrate their purpose and value to society.

Metropol TV’s Ingrid Nantege reached out to David Ongiro, the General Manager of Octagon Insurance Brokers Limited to delve deep into how the sector has been exercising its role in weathering the pandemic.

We have seen more people leaning towards taking out more insurance covers. What has been the situation for Insurance Industry in the country? What is the general overview?

We are living in strange times of all the ages, cash flows that have already shrunk. Organizations are struggling and most of them have closed businesses, some of them have completely changed the way they work now you’ll find people working more from home than from the office.

Some organizations have already reduced the space which they used to occupy “the physical space” to narrow down cost implications. Apparently, there are some organizations that have invested more in insurance, some have exhibited willingness despite the existence of anxiety in the market.

We don’t see the people having as much cash flow as possible to be able to afford very decent insurance covers us per se. There is a lot of willingness in the market but the only issue is the capability because of the shrunk revenues for most organizations but we are hoping that post-COVID-19 it is going to be a game-changer.

If you’re to talk to someone who’s has been affected by the pandemic and is struggling to understand if he or she should go for an insurance cover, due to constricted cash flow, what would you say now more than ever is the opportune time for people to take out insurance?

There is something for everyone, always. You will realize most insurance companies are becoming innovative and a bit flexible in terms of pricing and also benefits.

There are some products which are premiums that have been reduced and in a way, some are better. The industry has also come up with some sort of conglomerate of combined solutions, you’ll find more than ever before organizations now want a one-stop-shop.

I go for a combined solution with which has group life assurance which has grew Your personal access group, personal accident covers. So I think if there is a better time to buy insurances is now because then you will find there are more innovative products that are in the market and with very good pricing but even with superior benefits

There’s just so much out there for a consumer to pick up on.  At what point should one conclude which product to go for; For Example, if you’re looking at an SME owner, what would you say some of the products that are out there what would you recommend?

There are two ways to look at the products, there is one that will directly benefit the organization and there is then that one that directly affects the employee

Pandemics are usually not covered in insurance, so what happens is that you don’t necessarily find a cover that is able to take care of the pandemic but when there is a pandemic doesn’t mean that all other perils will stop happening to you, will not stop having a fire, you’re not having stop having theft the, burglary and all that. We try to come up with something that can always be able to cover you so that you don’t have adverse losses especially when you have an uninsured risk happening. With regards to pandemics, I’ll easily and very quickly advise organizations that it is time you check out which is this product that I can be able to cover to avoid my business from getting too much interruption when anything happens.

Secondly, on the employee part, there is a cover that every organization must have and it’s called Weber. It is a product where every employee must be covered but most organizations usually take it so lightly. Right now we have a pandemic; one will claim they contracted COVID-19 at a workplace and claims an entitlement for compensation.

But on the other side, you could have spent about Ksh.100 or Ksh.150 to cover the same employee against the benefit of Weber so that instead of taking care of that risk from the cash flows you are able to afford the risk to an insurance company.

It is not very common but there are some insurance covers where you can even be able to cover yourself against job loss. In this case, an insurance company takes up and pays you for six months or 12 months depending on the case. There are many products that we have out there that can be able to be customized for you as an organization, for you as an employee for you as an individual even for your parents and your parents in-laws

What should one think about when going to talk to an insurance broker, what should the conversation be like? And how do people access all this information?

I usually advise any organization that the best thing about insurance is not even the product itself but having somebody who works with you. What you call fine print language there, which you as an individual or you as an organization might not have a lot of time to interpret, you will need somebody who works with you carefully. It should not be someone who is interested in your money or your premium for a commission but somebody who walks you from the onboarding process the servicing process including managing your claims and managing your premiums.

My advice has been and will be always be that get somebody who is a good broker, get somebody who understands the industry very well, who understands how businesses operate who understands the needs of organizations and when they work with you are able to get the best product.

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