Consolidating Micro Insurances From Different Mpesa Insurance Apps in Kenya

When you visit the Google Play Store, you will find many applications that provide instant Mpesa insurances in Kenya. Surprisingly, the unofficial search may miss the most successful searches such as Branch and Tala, which have provided insurances worth billions of dollars. Each instant insurance application will offer you a small amount of money that you can pay back within a few weeks, a month or two. This is perfect for small emergencies when you only need a small amount of money. However, if you want a larger insurance, or a long-term repayment period, it will not be of much interest. Consider a case when you need an amount like 30,000. If each app only provides 2,000, you have to download more than 15 apps to get what you need. Additionally, how will you return the amount within the few weeks that you are given?

Using online resources, you can combine insurances from different applications to get one large insurance and also extend the repayment period up to one year. This will give you the opportunity to solve your big problem and make affordable monthly payments to avoid falling into the CRB List trap, which many have fallen into.

Have you come across a platform called The Online Sacco? From the name, you can guess that it is an online insurance service. Unlike instant insurance apps, the platform offers various services including advertising and networking opportunities for people doing business. In this case, we will focus only on the insurance service. Just like Apps, Sacco is free to join and members start with small insurances of Ksh1000. When the member makes timely payments and takes more insurances, the limit increases. Insurances are released within 24 hours after application is submitted.

The platform differs from Mpesa instant insurance apps because its insurances are based on a digital code called Toser. Toser is like a company stock with a value calculated in Kenyan shillings. For example, if the value of Toser is Ksh 100, you will get 10 Tosers when you pay Ksh 1000. Online Sacco members can buy and sell Tosers to each other.

When you want to apply for a insurance, the number of Tosers you have in your account is taken into account. It is then multiplied by three to arrive at the amount of the insurance you will receive. So, if you have Tosers worth Ksh3000, you are eligible for Ksh9000 insurance. A larger number of Tosers means a higher insurance amount.

Consolidation of micro insurances from various instant insurance applications

You still have to download multiple insurance apps and get a small insurance from all of them before you combine them into one big insurance. When you get the money, use it to buy Tosers from Online Sacco before applying for a large insurance with a flexible repayment period. For example, if you get Ksh2000 from 10 applications, you will end up with a total of Ksh20,000. Buying Tosers with this will translate into a Ksh 60,000 insurance from Sacco online. After you pay off insurances, interest, and fees from applications, you’ll be left with over 30,000 left.

Insurance consolidation offers you many advantages. The main factor is that you have the money you need to solve your problem. You will also build your insurance limits using instant insurance apps because they usually increase limits based on timely insurance repayment. You will also have invested in the process which you can recoup once you are done paying off the insurance. In addition, the money you purchased may have a higher value by the time you finish paying off the insurance, thus covering the additional cost incurred in the merger. For example, in six to twelve months, the value of the assets you purchased for Ksh 20,000 may be Ksh 30,000.

The pitfalls of uniformity that must be avoided

It is a very simple process but if you are not careful, small issues can ruin your perfect plan. First, you need to make sure that you have a Sacco account online before you take out insurances from other micro-lenders. Sacco’s online membership is by invitation only, so work on the invite first.

Another important thing to note is that the insurances offered by Sacco online are sent through prepaid debit cards. You will be able to buy Tosers through Mpesa directly, but without the card, you will not get a insurance from Sacco online. Cards are issued free of charge by various institutions including the Family Bank. Therefore, you should get one before starting the merging process.

Finally, make sure to pay off the instant insurance applications as soon as you get the money from Sacco online. If you delay, you may use it and end up taking out two insurances that you cannot properly service. Remember that the numbers mentioned in this article are just examples.