Why your team should be among those taking up group life insurance

By Evans Ongwae

Life is one big puzzle. Nobody knows for certain when an accident, illness, or death might strike, and the kind of destruction either of these could cause. Therefore, it pays to take some measures against such risks.   

Many people will agree that they have at different times been called upon to support fundraisers for various causes. Common ones include helping a patient to raise money for specialised care abroad or to pay a huge bill in a local hospital, or to help a family ferry the body of a loved one to the final resting place.

Madison head of group business Stanley Karanja, says this doesn’t have to be the case, because there is a way to avoid fundraising for such causes from the pocket. He points out that the solution is group life insurance, whereby employees or members of a group are covered for illness, disability, or death, by a single contract.

Mr Karanja recalls that the Covid-19 shock was an eye-opener to many. People realised they were ill-prepared for such an unexpected event that caused serious illness and death in some cases. The number of emergency meetings and fundraisers was simply unprecedented around the time.

The experience spurred more people to take up group life insurance with Madison, he says.

In vouching for the importance of life insurance, Mr Karanja cites former British prime minister Winston Churchill’s words. The famous leader of Britain once said during his time: “If I had my way, I would write the word ‘insure’ over every door of every cottage and upon the blotting pad of every public man, because I am convinced that, for sacrifices that are conceivably small, families can be secured against catastrophes which otherwise would smash them forever.”

Mr Karanja says more groups and chamas (investment and welfare associations) are signing up for group covers, particularly group life and funeral expense policies. This is unlike the situation that prevailed in the past, when people generally associated group life insurance with big corporate employers.

Small and medium enterprises (SMEs) are not left behind in buying this policy for their employees, to give them the peace of mind as they work. The realisation that insurance is great is largely experience-driven, such as a critical illness in a SME set up that almost leaves the employer and other colleagues obliged to support the sick and their family. Group life insurance basically alleviates this burden. The sharp spike in cases of cancer, major organ failures, and other critical illnesses, is quickly asserting the need for insurance.

Mr Karanja says from a social perspective, employers have a duty to provide life insurance to their employees to take care of, for example, critical illnesses. Group life cover supplements medical insurance, and is cheaper, compared to individual life policies.

An employee who suffers disability will need resources to deal with the disability as well as make some adjustments; maybe customise a car or a house. That employee will need funds to do so, and that is where a group life cover would come in handy.

Group life insurance also pays lump-sum as a critical illness benefit, enabling the employee to seek better treatment in good time, and increasing the chances of successful treatment.

“We know very well how high our dependency ratio is. One employee could be directly supporting 10 other people or more. Death is thus a very big blow to the dependants,” says Mr Karanja, as he goes on to explain that cash from a group life cover can plug the gap in lost income, so that the employee’s children can continue to attend school, and the family is not evicted from their rented house.

Group life insurance, he says, responds to current problems, as “there are more cases of cancer and kidney failure”. “Provision of funds at a critical time saves lives,” he adds.

Mr Karanja points out that all kinds of legitimate groups can formalise their existence through registration and take group life cover that provides a variety of benefits. Some policies require a group to comprise a minimum number of five people, but the more common ones need at least 10 people.

At Madison, employers (including SMEs) and diverse groups can go for a group life product of their choice. The insurer’s funeral cash product, “Lala Salama”, pays funds within 48 hours of notification, to enable families and groups to take care of funeral expenses. The benefits can be extended to children, parents, and parents-in-law. Better still, the product has a repatriation benefit allowing professionals to handle logistics relating to the movement of the deceased to their final resting place.

“Our Group Multi-Benefit product is especially designed for small and medium enterprises, allowing employers to insure their employees from a minimum number of five. It provides survivor benefits, including critical illness, temporary and permanent disability benefits, hospitalisation, last expense, and death benefit. Spouses can be added to the policy,” Karanja explains.

The group life insurance is targeted at larger employers and offers critical illness, permanent disability, and last expense benefits.

For more information about Madison’s group life products, visit www.madison.co.ke

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