KCB and National Bank of Kenya have signed a distribution deal with Sanlam Life Insurance in a bid to deepen the uptake of life insurance products in the country.
Through KCB Bancassurance Intermediary Limited (KBIL) and National Bank Bancassurance Intermediary Limited (NBIL)—their respective bancassurance franchises—customers will be able to access a full range of financial and investment products within the banks’ combined 300 branches.
This will see KBIL and NBIL distribute life insurance products, underwritten by Sanlam. The partners have also rolled out an endowment policy dubbed Nawiri, a savings and investment product that offers a guaranteed return after a specific period of time.
They have also introduced an enhanced education policy Elimisha Plus Cover and a more robust Last expense Cover, a funeral insurance product that helps cover the costs associated with bereavement. Nawiri comes with a tax relief element while the bereavement cover brings a tax-free death benefit upon the demise of a policy holder makes this a suitable option for investment.
The proposition is expected to deepen KCB and NBK play in the insurance market, effectively boosting Kenya’s life insurance penetration rate which currently stands at 1.3 per cent according to the regulator Insurance Regulatory Authority (IRA).
“We are reimagining insurance by leveraging the existing offerings and rethinking the distribution model to ensure we take the products to the uninsured population across the counties and every corner of the country” said Mrs. Annastacia Kimtai, the Managing Director at KCB Bank Kenya.
Sanlam Kenya Group CEO, Dr. Nyamemba Tumbo said: “For customers who prefer to receive services from a one-stop-shop like a bank, this partnership comes in handy for them as they will now be able to access a full suite of financial services to meet their long-term investment needs. We shall therefore leverage our distribution and processing capabilities, stronger brand visibility and a greater degree of public trust to deliver a superior customer and product experience,” Said Mr. Tumbo.
Overtime, the bancassurance distribution channel has emerged as the natural choice for mass-market clients looking for simple and low-cost products being offered by financial institutions.
The Association of Kenya Insurers in its 2017 study indicated that about KShs. 6 billion of life business was through bancassurance while that of non-life was estimated at KShs. 10 billion. This points to a growing need for the model of distribution to be utilized optimally to unlock greater returns.