Insurance penetration in Uganda remains low compared to other East African Community members of Rwanda, Kenya and Tanzania.
Uganda’s insurance penetration as of 2016, lies at 0.9%, while Rwanda, Tanzania and Kenya have penetration of 2%, 2.3% and 3.8%, respectively.
Among the issues hindering insurance penetration in Uganda and Africa as a whole include limited disposable income due to poor household incomes, lack of insurance education to the rural folk and partly, the complexity of the whole process by the traditional insurance companies.
MTN Group in partnership with MMI Holdings made a move to extend insurance services to even the local people by introduction of two products, ‘Recharge with Care’ and ‘Send with Care’ the two of which are part of Micro insurance package, aYo Uganda.
Announced in September 2016, the products were officially launched in January 2017 and unveiled to the public although not a lot had been comprehended in regard to the same.
PC Tech Magazine caught up with Edwin Kwesiga, the Chief Executive Officer for aYo Uganda to understand more about breakdown, the operation, the benefits of the two products and how different aYo is, from the traditional insurance products.
Mr Kwesiga says every person who owns an MTN line and loads airtime is eligible for the ‘Recharge with Care’ product while ‘Send with care’ would require one to be registered on MTN Mobile money and to send money to a loved one.
“aYo services are open for everyone aged between 18 to 65 years. Everyone who has an MTN line and registered on Mobile Money has access to the insurance services,” he says.
He says aYo caters for three instances including life insurance, in case one passes on, and accidental hospital, in case one spends a night admitted in a hospital after an accident and school fees for child in case the parent passes on.
Compared to the traditional insurance companies, Kwesiga says, aYo products are easy to use due to their digital self-service model since everything is done on USSD.
“aYo has a lot of exclusions. No paper work is required, no medical checkups to establish preexisting medical conditions are required. One needs to dial *296# for Recharge with care and *165*1*4# for Send with care and that’s all that is required.”
Recharge with Care
aYo Recharge with Care offers MTN pre-paid customers an easy way to get free hospital or life cover. Whenever you load MTN airtime, you will receive ten times the amount of airtime loaded (free hospital cover) and 15 times the amount loaded (Free life cover) for 30 days.
Mr Kwesiga explains that “Recharge with care is what you may call a Freemium offer. Since MTN is one of the partners investing in aYo, this package comes free of charge and all the costs are met by MTN.”
“It doesn’t matter whichever way you recharge; whether using scratch cards, Mobile money or pay way, you will receive the cover whenever you top up; accept for the cases of me to you,” clarified Kwesiga.
“There is an option to boost your cover where you can buy cover and boost it either just one time or auto boost where a certain amount is added to your cover every time you recharge.”
To sign up for Recharge with care, simply dial *296# and choose the cover you prefer: MyHospital or MyLife.
Send With Care
Adding aYo Send with Care to MTN Mobile Money transfers means that, in the unfortunate event of your passing or should you be hospitalised for a night or more, aYo will pay triple the amount you sent to your beneficiaries, either in one lump sum or in 12 equal monthly installments, depending on your cover level.
“A premium of 5% of the money being sent is charged off the sender’s balance; and you earn an insurance cover worth three times the amount being sent. Unlike the case with ‘Recharge with Care’, the cover here lasts for four months,” said Kwesiga.
He explains that the cover caters for Life, Hospital and school fees (if you have been paying via mobile money)
“Pay out for school fees is made in a single lump sum while for hospital and life, its spread over a period of 12 months according to how much you used to send. If you have been sending money to your mother, we want to make sure she keeps receiving some money for a living until you recover and get back to work,” said Kwesiga.
He explained that “it doesn’t matter how many people you have been sending money to, everyone will continue receiving their portions according to how much was being sent to them monthly.”
Mobile money subscribers can join ‘Send with Care’ by dialing *165*1*4#.
Claims and PayOut
Kwesiga says that for one to make a claim, they need to have spent atleast a night in a hospital after a traumatic event or in the event that someone dies, the beneficiaries can make claims.
“A claim can be initiated in case someone passes on or in case someone spends a night in a hospital after an accident. For hospital cover, a client needs to go to a hospital that is registered with the Uganda Medical and Dental Practitioners Council (UMDPC) and a doctor has to confirm that it was an accident,” he said.
“For hospital cover, one has up to 180 days after the occurance to make a claim and it can be processed within 48 hours after consultation with the hospital.”
“In the case of ‘send with care’ where the beneficiaries are more than one, only one person is needed to trigger the pay out and the rest of the beneficiaries will receive their payment instantly via mobile money.”
How different is aYo from MTN Life Care and other insurance products?
Kwesiga says that the ease of access and flexibility that aYo presents is big a difference between them and the traditional insurance.
On the distinction between MTN Life Care and aYo, Kwesiga says the business models are different.
“Unlike MTN Life Care where MTN partnered with an insurance company to provide the services, with aYo, MTN is one of the investors and that shows their confidence in the product,” said Kwesiga.
“Our model is built to appreciate how society lives in Uganda and with the high proliferation rates of Mobile money in Uganda; insurance penetration is going to be high.”