Cement maker Bamburi has offered its retailers a Ksh150 million ($1.5 million) medical insurance cover.
The Afya Ya Nguvu deal for inpatient and outpatient cover, whose underwriters are Sanlam General Insurance, is expected to benefit 800 people to reward the retailers’ loyalty.
The scheme will be administered by Alexander Forbes.
“We conducted a market survey and realised that only 36 per cent of our retailers had medical insurance. Afya ya Nguvu is a direct response to this need,” said Bamburi managing director Bruno Pescheux.
Alexander Forbes executive director, James Olubayi urged companies to develop solutions to ease the burden of health costs on their various constituencies, which are critical for the survival of any organisation.
“When innovation in product design is applied then one can strike a balance between benefits and price,” he said.
Healthcare in Kenya remains a costly affair as most families rely on savings to access health care and are often pushed to fundraise to manage chronic illnesses.
The cement maker is the first manufacturer to offer such a service to its retailers in Kenya, where a majority of health insurance schemes are offered to employees in the formal sector.
As at January 2017, 6.2 million Kenyans were registered with the National Hospital Insurance Fund, but only four million were consistent with their monthly payments.
Informal sector workers make up only 39 per cent of the total workers registered with the NHIF, despite constituting 83 per cent of the over 15 million Kenyan workforce.
Kenya has the highest informal sector employment in Africa, accounting for 77.9 per cent of total employment, ahead of Rwanda’s 73.4 per cent Uganda’s 59.2 per cent and Tanzania’s 8.5 per cent according to a 2015 report by United Nations’ Economic Commission for Africa.
Medical insurance accounts for only 22.1 per cent of the Kenyan insurance market. A survey by online health service provider Daktari Africa shows that only 12 per cent of Kenyans are subscribed to insurance programs, translating to 480,000 people out of the country’s over 40 million population.