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Structuring insurance cover for pensioners

12 November 2014 Gari Dombo, AFI
Gari Dombo, AFI MD.

Gari Dombo, AFI MD.

Alexander Forbes Insurance (AFI) says pensioners should be offered specialist insurance products and not treated just like younger, riskier counterparts who they are often required to cross subsidise. They also should not be expected to fund other younger segments of the population.

According to AFI MD, Gari Dombo, older people treat their possessions with a greater level of experience, responsibility and care than the youth. “Older people take fewer risks on the road, in most cases do not travel in higher volume traffic like peak hours which reduces overall exposure and therefore offers a lower level of risk,” says Dombo.

Dombo said that this insight has resulted in AFI extending wider personal and household insurance cover to people aged 55 years and older at a significantly lower cost than other age groups. He says for example, on a standard product like short-term insurance for a vehicle, the premium paid by a client aged 55 or more can be up to 25% lower than that paid by someone under 35. “Our 55 Plus product is designed specifically for pensioners and does not carry an excess for example,” adds Dombo.

AFI acknowledges that there are different risk profiles to various age groups, and the company cannot therefore apply a one-size-fits-all approach when calculating premiums and designing product offerings.

AFI offers the 55-plus age group insurance that is tailored to their risk profile and is therefore more affordable.

“The cover includes no basic excess payable and lower premium for living in a secured property. The policy also includes travel advice, 24-hour accident, emergency and telephone assistance and pays vehicles out at current retail value, not market value,” says Dombo.

Dombo adds that having a product that specifically caters for the needs of this group and their lifestyle and behaviour is important.

“We will continue to pass these benefits on to our 55-plus age group in the form of affordable, comprehensive and hassle-free household and motor insurance,” says Dombo.

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