Insurance is always a much maligned topic to discuss. People don’t easily understand it, but we have been insuring ourselves for centuries. On the informal level, the whole concept of community living was an insurance policy. We lived with others to pool resources. When disaster struck, we took care of one another. In place of funeral covers, we had (still do) chamas za matanga. As a country, we even made it a national philosophy to pool together to help one another. If your kids were in need of school fees we came together each with whatever we could afford. If our relatives fell ill and needed money for medical care we were quick to do the Harambees and take care of that.
Lately however, three things have happened that have led to the decline of the Harambee culture. Firstly, the government banned the participation of public servants in Harambee. So that code of ethics took away a great percentage of contributes in Harambees. Secondly, due to modernization, people are increasingly disengaging from carrying the community burden and leading more private lives. We know guys that have even taken things on the extreme by completely cutting off even their own families. Always sad to see those elderly parents that have been abandoned. See that and get ready, you don’t want to be the burden your kids want to shed off at the earliest opportunity. Thirdly, the whole Harambee thing has been misused, people have been conned in the Harambee business. Greedy guys wanting top life at the expense of the humble good willed masses. This has led to the decline of that hitherto very important insurance scheme of Harambees.
Granted, there have been innovations around how we go about Harambees nowadays. We hardly converge in person for the fundraising, we increasingly are crowd-sourcing via online platforms including WhatsApp groups, fabacebook groups and Paybills and M-changas of the world. You know how you react when you find yourself in a WhatsApp group for initiatives you don’t understand. The courageous guys will “left” the group immediately while others lie low. Making neither a complaint nor a donation. Its a shame but such initiatives are increasingly unable to meet their target amounts.
With the imminent death of Harambees comes the birth of formal insurance covers. Much as it is still a much maligned topic, we will attempt to discuss it here. You need insurance. So, instead of making excuses to escape from it, you had better educate yourself on the concept of insurance and the pros and cons of the many covers in the market. Some insurance covers are sanctioned by the law while most are still voluntary.
As an entrepreneur, it is important to get to know what insurance is mandatory for your case. In the case of motor vehicles and Boda Bodas, the law requires that you get at least a third party cover. If you have employees it is mandatory you get them at least a WIBA. Time is gone when your employee suffers an injury in your establishment and then it becomes your responsibility. Growing up, I knew someone who had lost his right hand to a stone crushing machine and it was left to the employer to pay him. The poor guy was paid 10k for such an injury. Sad. Failure to get such covers are very risky for your business, you can be sued for damages which can kill your entire business with a single shot. For most entrepreneurs taking loan products from formal financial institutions, there is a tiny percentage that goes towards insurance. In case of an untimely departure, not only is the entire loan written off, the insurance often comes with a small bahasha to say pole. Woe unto you if you depart with a shylocks loan, the harassment that will be visited upon your departed family will be great.
Another very important cover is Health Insurance. The law requires that all employees must pay NHIF and to make it effective, it is upon the employer to withhold the necessary amounts from employees’ salaries and then submit it to NHIF. How about the Masafaras? The law does not force you to take an NHIF cover, but it’s highly desirable that you do. It’s easy to make execuses how you really can’t afford 500 shillings monthly, but sickness will come, and you can’t always count on Harambees. Sickness can be very be destabilizing to entrpereneurs. Some people have had to sell their assets or even the entire business just to take care of the medical bills. How comforting would it be if you know whatever the case, you can always walk into a health centre and get attended? How would you feel if you had to fire your employee because they got sick and you really can’t carry the burden? Shame. Granted, there have been problems with NHIF before, but most of them are innocent on the part of the NHIF. We had better pay, when the emergencies come, that can be sorted. It’s desirable that as many people as possible take up the NHIF cover, then we embark on making sure that no one misappropriates a coin of such important money. Even those who can afford other private or corporate insurance. Let’s support those universal health covers, it goes in helping those who can’t help themselves. Not only the NHIF, counties are also setting up similar covers, Makueni County has universal health Cover, lets support them.
There are also aspects of insurance that are not mandatory but very important nonetheless. Picture this, you have worked so hard, acquired some machines and equipment, stocked up your business with sufficient moving stock etc. Then fire happens, or thieves come to reap where they did not plant. I know people whose businesses have been completely ruined by such emergencies. A serious entrepreneur should know that at some point you will amass what you can’t afford to lose and get insurance. I know it has been possible before for friends to do a Harambee and bring you back to life. That is becoming history very fast.
Other Insurance Covers.
It might be easy to think of insurance as a waste of money and a luxury. While I don’t advocate for you to run drag yourself into poverty paying up policies, there is definitely some good covers out there. Not to alarm you, but we have seen that there are people whose family prosper when they depart and others whose families suffer upon the same. When an entrepreneur who had either a personal accident cover, or life policy or even an education policy departs, the kids may be assured of getting an education. The family will be left with some money ya kujipea pole and to stabilize them as they cope. They might even have some extra money to boost the capital of their business. On the other hand, entrepreneur without any cover leaves nothing but trouble and a crumbling business.
If you are in the business of living or entrepreneurship. Get to know about which insurance is applicable to you either by law or self-interest.
It would be nice to see your views about insurance.