Airtel warns Safaricom against copying its products

AIRTEL entry into the life insurance business on Wednesday prompted the chief executive officer Adil El Youssefi to warn the rival Safaricom against copying the product saying its “innovative enough to double our customer base”.

“Airtel insurance is a mass market product. The copying of our products by the dominant competitor will not be tolerated,” he said during the launch in Nairobi.

He said they are aware the Airtel visa card which was launched in September 2014 has been copied adding Safaricom might launch a similar product next month.

Airtel currently has six million subscribers who it expects to be the first consumers of the new insurance product before it hits the rest of the market.

The telecommunications provider has partnered with the underwriters Pan Africa Life and Micro Ensure in setting up the cover that will provide accident and hospitalisation benefits based on the monthly airtime usage of the signed up subscribers. “We have been working on this product for over a year now. Its available to subscribers aged between 18-65 who will only need to sign up via a short code and consume airtime up to the Sh250 mark each month in order to be eligible for the benefits,” he said.

Subscribers are advised to dial *336# in order to sign up.

According to Airtel, a monthly usage of Sh250 airtime will give the customer Sh1000 hospitalisation and Sh10,000 life and accident insurance while Sh500 airtime usage will earn Sh2000 hospitalisation and Sh25,000 life and accident. The other two packages require subscribers to use Sh1000 or Sh2000 airtime in order to earn hospitalisation benefits amounting to Sh5000 or Sh10,000 and life and accident benefits of Sh100,000 and Sh250,000 in each.

Head of Pan Africa Life Assurance Stephen Kamanda said the product design could revolutionize life insurance uptake in Kenya to much higher levels from the current 1.2 per cent, mainly because of the high penetration of mobile phones in Kenya. “The eminent gap together with the need to provide life insurance is what motivated us to bring this solution in this market,” he said.

The Communication Authority of Kenya data for the second quarter of the 2014/2015 financial year show 33.6 million people own a mobile phone, representing a penetration rate of 82.6 per cent.