Boost cover reach, Kalonzo asks firms
A delighted Agnes Kagure Kariuki of CFC Life Assurance is lifted high by her colleagues in jubilation after she emerged the overall top agent and was presented with an award for achievement in production of quality life assurance business in the year 2009 during the Association of Kenya Insurers Agents of the Year Awards (AAYA) 2009 ceremony held at Intercontinental hotel. PHOTO/ CORRESPONDENT
What you need to know:
- Cultivating confidence among clients is the way to go
Vice President Kalonzo Musyoka has asked the insurance industry to boost public confidence in their products if penetration is to increase to 2.7 per cent of the GDP.
He said the industry needs to enhance corporate governance and work towards boosting public confidence in their services among existing and potential consumers.
The VP said well-financed insurance industry is a key pillar in protecting consumers.
He said that the new capital requirements set to take effect in the next two months, will help restore public confidence and enhance competitiveness among local insurance companies.
“Considering the emerging global trends, insurance firms must seek ways of adapting innovative ways of providing world-class services other than equity participation in huge international corporations. Insurers could pursue strategic alliances or seek mergers with banks to address the issue of Bancassurance” said Mr Kalonzo.
He said this in a speech read on his behalf by the permanent secretary in his office, Dr Ludeki Chweya during the Association of Kenya Insurers (AKI), Agents of the Year Awards on Friday night.
Policy number
During the event, 261 insurance agents were recognised and honoured for achievements in different criteria including the number of policies issued, persistency rates and the volume of business generated.
Mr Kalonzo said there is need for local insurance firms to invest more in training life cover agents in all aspects of financial planning to enable them offer trusted advice to customers.
This is because according to a Financial literacy survey (FINACCESS 2009), 45.6 per cent of Kenyans turn to friends and family for financial advice with another 25 per cent relying on financial institutions (bank, insurance company or SACCO) for such advice.
AKI chairman Stephen Wandera said the association is rooting for introduction of compulsory insurance for public buildings and a more favourable tax regime for life and health insurance business in the next budget.
He asked the government to consider the proposal seeking to treat all premiums paid on life and health insurance as deductible from chargeable income up to a maximum of 30 per cent, saying this has the potential of mobilising savings.
“This will allow the insurance industry to contribute more to the economy. We are optimistic that the government will favourably consider our proposals,” he said.
Mr Wandera backed the proposal in the Insurance Act to split composite insurance companies into different entities offering life and general cover business to ensure adequate focus on life insurance operations.
