Insurers ride on mobile technology to ease healthcare financing

Bodaboda rider Michael Wathiga needed a safeguard in the eventuality that he or a member of his immediate family was to fall sick.

The resident of Githurai 44 in Nairobi stumbled on a mobile based platform that allowed him to save money from his mobile wallet to the account, purely for offsetting medical bills.

“I had developed ulcers some time back and I thought it was just a common stomach ache. I did not have money with me but I had been saving on M-Tiba; it paid for my consultation at the St John’s Hospital in Githurai and also for medicine to start me off,” he said.

As the number of mobile users continues to steadily increase, services, insurance included, are also moving in the same direction.

“The mobile telephone sub-sector demonstrated an upward trend between January to March 2016, with mobile subscriptions growing by 1.8 per cent to reach 38.3 million up from 37.7 million subscriptions recorded during the previous quarter. Consequently, mobile penetration increased to 89.2 per cent up from 87.7 per cent recorded last quarter,” says official data from the Communication Authority of Kenya.

For ease in service delivery, health financers and insurance companies in the country have moved the competition for more customers to mobile-based products that shorten access to healthcare services.

Most Kenyans pay for healthcare expenditure out-of-pocket. Many do not have insurance or access to mechanisms that pay for basic healthcare, hence posing a burden on low-income homes.

To boost uptake of the health insurance products, the firms have resorted to leveraging on mobile technology to offer services through innovative e-wallets.

M-Tiba is one such product by Safaricom in partnership with CarePay and PharmAccess, allowing users to send, save and receive money through M-Pesa, to access healthcare services through mobile phones.

“For many Kenyans, a trip to the clinic can create real financial strain. And it can have a knock-on effect in people holding down jobs, or having to sell their belongings to pay for basic care,” said Safaricom chief executive, Bob Collymore.

UAP Old Mutual Health Insurance, which manages the funds in M-Tiba, is offering 12 months personal accident cover worth Sh8,000 for M-Tiba principal members and one spouse. This is for the first 100,000 registered users who deposit at least Sh100 on their M-Tiba mobile accounts.

Already, over 60 healthcare facilities in Nairobi including Gertrude’s Hospital, Plaza Imaging, St John’s Hospital-Githurai have signed up for M-Tiba, with over 45,000 people currently using the platform.

A non-deposit taking company, iNuka Pap has also signed a deal with Britam offering Kenyans an “automatic” medical insurance cover once one has saved up a minimum of Sh20,000 on the platform.

Members of the iNuka Pap mobile app stand to get an inpatient cover limit of up to Sh200,000, with another Sh100,000 limit for chronic, pre-existing and psychiatric cases.

The product funded by iNuka Pap — dubbed iNukahealth — is available on Play Store. It allows users to save using M-Pesa.

“Clients who have saved up to Sh20,000 will have an automatic inpatient cover funded by iNuka Pap and an outpatient loan of up to Sh20,000,” said iNuka Pap founder and chief executive, WaweruKuria.

Mr Waweru told the Business Daily that they project to get 40,000 users on board in the next four months.

The online lender is funding the insurance costs by sharing back revenues generated through loans disbursed by the platform and subsidised by donors and investors who have been looking for disruptive solutions to the insurance sector in Africa said.

One can apply for this policy through iNuka Pap’s digital platform and access services through Britam contracted hospitals.

The applicant and the spouse should be between 18 and 65 years at entry. The policy is renewable annually but has an expiry age of 70 years.

In case of an accident and one is admitted in a hospital not in our panel, the customer should notify Britam within 24 hours,” said Eunice Maina, Micro Insurance, Britam.

Policy

The iNukahealth insurance policy does not cover everything but offers a last expense cover limit of Sh40,000 in case of death. A maternity cover of Sh20,000 is also offered.

“We also offer an annual premium of Sh5,000 for every member. For every extra member the premium goes up by Sh1,000 that is to be footed by the principal member,” said MrWaweru.

Sanlam Kenya, formerly Pan Africa Life Insurance, has said it also has plans to offer insurance products through mobile phones in an effort to boost uptake.

Having a mobile insurance product has however been an uphill task.

Britam’s attempt to cover the low-income households using mobile innovation proved costly forcing the insurer to pull out on individual sales of its popular Linda Jamii product, redirecting its energies to small and medium size enterprise groups. This was in partnership with Safaricom.