By Meshack Miyogo
Businesses are investing heavily in strengthening their defences against cyber attacks, supply chain disruptions and economic challenges. Yet, amid these threats, one of the biggest risks remains deeply human: the loss of an employee whose absence as a breadwinner can create financial challenges for their loved ones.
Insurance can provide an important financial safety net when such events occur.Yet, the belief that insurance is too expensive can discourage many people from taking up cover. A 2024 FinAccess Household Survey for the insurance sub-sector found that cost was the main reason cited by 76.2 per cent of Kenyanswho did not have insurance.
This is where Employee Group Life Insurance can make a difference. Group arrangements can help make insurance more accessible by allowing employers to provide cover for many employees under one scheme, making it a practical way to protect their workforce.
Employee Group Life Insurance is a cover provided by an employer to staff as part of their overall employment package. It provides financial support to employees and their families when unexpected challenges occur. For example, Employee Group Life provides a safety net to the family of an employee who loses their life from illness or an accident. The amount paid depends on the employee’s cover and may be afixed amount or an amount based ontheir salary. For a family that has lost a source of income, this support can help meet pressing financial needs and provide some stability when they lose their breadwinner.
But the value of Employee Group Life extends beyond the death benefit.
A well-structured scheme can also provide financial support when an employee is no longer able to work because of illness or an accident. Under the Total and Permanent Disability benefit, an employee who becomes permanently and totally disabled may receive the same amount paid under the death benefit. This can provide an important financial cushion when they are no longer able to earn an income.
Employers can also enhance their Group Life schemes through additional benefits, usually referred to as riders, which can be added to the main policy to provide extra protection at a relatively low cost.
A critical illness rider, for example, provides financial cushioning when an employee is diagnosed for the first time with a critical illness such as cancer or kidney failure, assisting them to seek advanced medical care in or outside the country. A Temporary Total Disability rider provides support when a staff member becomes temporarily unable to work due to bodily injury and is therefore unable to earn an income. Depending on the agreement with the insurance partner, the benefit can provide actual weekly earnings for a period ranging from one to two years.The medical reimbursement option, on the other hand, helps cover medical bills incurred following an accident.
The strength of a Group Life plan depends on how well it responds to the needs of the people it protects. For employers, this means looking beyond Group Life as simply another employee benefit and recognising the role it can play in supporting employees and their families through difficult circumstances. After all, organisations depend on their people. Providing them with financial protection is not only good for their wellbeing; it also contributes to a more secure and resilient workforce.
The writer is the Managing Director of CIC Life Assurance Limited.
