1. Development of Micro Insurance in Kenya AIO Life Insurance Seminar 2015 Lomé - Togo Presented by: George Odera 27 th November 2015

2. “Just as a fish doesn't know it is wet, so do companies often fail to see or feel the very opportunities they are swimming in”.Pam Handerson SLIDE 2 AIO Life Insurance Seminar 2015 Demystifying Life Insurance

3. Agenda 1.Key Facts About Insurance in Kenya 2.Drivers for Micro Insurance 3.Challenges 4.Parting thoughts 5.Questions/Comments SLIDE 3 AIO Life Insurance Seminar 2015 Demystifying Life Insurance

4. AIO Life Insurance Seminar 2015 Demystifying Life Insurance 1. Key Facts About Insurance in Kenya  A small proportion (7%) of Kenya’s population (44m) have access to insurance.  Insurance penetration rate is 3.4% as a percentage of GDP  45% of Kenyans are aged below 15 years.  United Nations Human Development (2009) estimated Kenya’s poverty levels at 19.8% of the population.  Low-income households heavily exposed to the consequences of risks that materialize.  They might : be compelled to sell assets cheaply remove their children from school relocate to cheap settlement areas (slums) take on high interest loans SLIDE 4

5. SLIDE 5 2. Drivers for Micro Insurance  Potential target market in excess of 11 million adults.  Innovation (Mobile Phones) AIO Life Insurance Seminar 2015 Demystifying Life Insurance

6. SLIDE 6 Drivers for Micro Insurance Cont. AIO Life Insurance Seminar 2015 Demystifying Life Insurance  Distribution Channels. (Mobile Money) Mobile money has become the preferred mode of payment.

7. SLIDE 7 Drivers for Micro Insurance Cont. AIO Life Insurance Seminar 2015 Demystifying Life Insurance  Strategic Partnerships Govt. is offering livestock insurance to pastoralists thru’ insurance companies. Insurance companies have partnered with self-help groups to provide life cover to their members.  Regulations The Insurance Regulator in Kenya has developed a Micro Insurance policy paper.

8. SLIDE 8 3. Challenges  Employment insecurity and low levels of disposable income  Low literacy levels and general financial awareness.  Poor perception of insurance-family is viewed as a traditional safety net.  Cultural beliefs-anticipating misfortunes is a taboo.  Insurance brands command lower trust levels compared to other financial institutions. “No one wakes up in the morning wanting to buy insurance – But we are convinced that people wake up in the morning worried about the risks they face” – Richard Leftley, CEO Microensure AIO Life Insurance Seminar 2015 Demystifying Life Insurance

9. SLIDE 9 4. Parting thoughts.. AIO Life Insurance Seminar 2015 Demystifying Life Insurance  There a huge potential for Micro Insurance to increase access to life insurance cover for the wider Kenyan population.  Consumer education and building trust is of paramount importance.  There are various success drivers for micro insurance, however, we need to be cognizant of the underlying challenges.  Companies ought recognize the opportunity that micro insurance presents and develop products tailored to meet the needs of the clients.

10. Questions/Comments Contacts: Email: lg.odera@gmail.comlg.odera@gmail.com Tel: +254722725416