Insurance claims rise five-fold during Covid-19
Insurance claims involving Savings and Credit Cooperatives (Saccos) have risen five-fold in the last two years due to the Covid-19 pandemic.
The death of members, funeral and medical covers topped the claims category as Saccos lost businesses, membership and contributions due to the pandemic.
This came as the cooperative movement, which was adversely affected by the pandemic through defaults, reported business improvement.
Speaking during the CIC Insurance Group’s Annual Cooperative Summit in Naivasha, Chief Executive Patrick Nyaga said Covid had adversely hit the sector hard as they moved in to cover their members.
The meeting was attended by over 200 chief executives of co-operatives.
Nyaga noted that between January and September this year, the insurer that covers co-operatives movements had paid Sh1.7 billion in claims. “The pandemic led to a loss of lives and unpaid loans and we moved in to cover this as part of our contract with the Saccos,” he said.
Addressing the press at the sidelines of the meeting, Nyaga said the pandemic was not yet over, and they would continue to support the cooperatives affected. “We are developing new products suitable for our clients and we are targeting cover for persons who are over 60 years in age,” he said.
Tembo Sacco Chief Executive Lydia Mungai said hundreds of their members struggled to service their loans while others lost their lives due to the pandemic - with the levels of losses and disruption differing from one business to another.
“In the last two years, the claims that we presented to CIC went up five times due to the number of deaths and unpaid loans caused by the pandemic,” she said.
This was echoed by Kenya National Police Service Sacco CEO Solomon Atsiaya who said cases of loan default shot up during the two years.