The rising cost of education makes it very important to plan for the future education of your children. One of the best ways to plan for it is to commit to an education policy. Today we shall focus on the best education insurance plans in Kenya, comparing top education policies in the market that you should thoughtfully consider.
Parents are increasingly enrolling in education insurance policy plans because they offer a proper education savings plan and life protection.
This means that regardless of the turn your life takes, the future education of your children is guaranteed.
They are beyond the normal education savings plan in so many ways as you shall see as I compare the top education insurance providers briefly and specific top education policies in the market.
This write-up shall compare both education insurance providers and the best education insurance policies offered by these providers. Not just companies.
I will also highlight how education insurance works and help you choose the right plan.
What Education Insurance Plans Are in Kenya
Education insurance policies or plans are savings plans combined with life protection designed to cover future school fees and related costs of your children.
They are insurance endowment plans in that they combine elements of savings and life protection.
When one enrolls in an education insurance policy, they pay regular contributions known as the premium monthly, quarterly, semi-annually, or annually.
Premium payment schedule is determined by your preference or ability to pay. For example, an employee would prefer a monthly contribution deducted from payroll in what is referred as the check-off payment.
Education insurance plans promise to pay maturity payouts/bonuses at particular stages of the policy term. Policy term is the duration your education plan will be running and the policy term is determined by the level(s) of education you want to cover in the future with the policy you have adopted.
For instance, Britam Boresha Elimu is an education policy designed to build an education fund for both CBE and IGCSE curriculum levels that take 3 years to complete. The plan pays 3 bonuses in the last 3 years of the policy term hence adequately covering CBE Junior Secondary, CBE Senior Secondary and IGCSE Lower Secondary levels.
Education insurance policies are popular in Kenya because they offer a savings plan with good savings returns cancelling out inflation (in some plans), life protection, disciplined saving, and structured education funding offering peace of mind.
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Key Things to Understand Before Comparing Plans
For any insurance company and specific insurance policies to be listed here, I have considered very vital elements which you must understand too for you to pick the right education insurance plan for your kids.
These elements are the ones that make an education policy superior or mediocre.
The following elements are our qualifying factors and they include:
- Premium contributions
Premium contributions are designed such that they must be made regularly (monthly, quarterly, semi-annually, and annually) and are subject to certain minimums from policy to policy.
Some policies have very affordable minimums while others have a little bit higher minimums.
- Policy duration
Policy duration or policy term is that period your policy is intended to run in years before it fully matures.
The policy term is mostly determined by the education level you are raising an education fund for.
Policy terms mostly range from 5 to 22 years aligning with a child's education stages.
- Payout structure
The payout structure is the schedule showing the timing of maturity benefits in specific dates given the time your education policy was placed.
For example, Britam Msingi Poa Education Plan payout structure is designed such that the maturity benefits are paid (staggered) in the last 4 years of the policy term. The 4 bonuses (benefits) are supposed to clear school fees and related costs for 4 years e.g. 4 years university fees or IGCSE O & A-level combined school fees and related costs.
In Msingi Poa, you do not pay premiums in the last 3 years of the policy term as the bonuses are being paid.
Msingi Poa is one of the most profitable policies in the market. It has beautiful returns especially in the long-term and proper life protection guaranteeing the future education of your children.
- Investment returns
Most education insurance policies offer savings returns in guaranteed vs non-guaranteed bonuses.
Guaranteed bonuses are paid at maturity and have specified dates.
Non-guaranteed benefits are usually not stipulated in the policy documents and happen as you continue to faithfully make your regular premium contributions.
- Protection benefits
Education Insurance policies come with life protection to guarantee the future education of your kids.
Life cover is in the form of protection against permanent disability due to sickness or accident and death cover.
If any of these unforeseen events occur to a policyholder, in most policies, premiums are waived immediately and the maturity payout will be paid when due guaranteeing your future education goal.
In some instances, you can add a few shilling, and I mean a few shilling literally, to add permanent disability and death cover, such that an instant amount is paid immediately as you wait for the maturity payouts once one of these unfortunate events occurs.
- Liquidity rules
Sometimes, other unfortunate events occur in life destroying your source of income, that enables you to sustain the regular premium contributions.
In such cases, you can opt out and the time you can opt is defined in your policy documents.
Ways of opting out include cash surrender value and paid-up option.
Cash surrender value happens if your policy is at a particular stage (age) where you can cash it out. The amount of money is determined by the insurance underwriters and includes a penalty.
The paid up option is where your policy is at a particular stage and instead of cashing it out, you let your contributions stay with your insurance company until maturity of the policy.
In this instance, you are not penalised, but you receive lower maturity payout(s) than before.
Major Education Insurance Providers in Kenya (Quick Overview)
- Britam Holdings PLC
Britam is the leading life insurance company in Kenya and it has consistently been so for over 10 years. It is also a major player across East and Southern Africa, offering life insurance, general insurance, asset management, retirement solutions, and property services.
In the education planning space, Britam is especially known for structured long-term education savings policies that help parents accumulate funds for school and university fees that include Msingi Poa, Boresha Elimu, Soma Sure, Super E among others.
For this comparison, I will focus on their most popular education insurance policies, Msingi Poa and Boresha Elimu education plans.
- CIC Group
CiC insurance is yet another formidable opponent in Kenya offering life, health, general, and asset management services across the region.
One of their popular education policies is CIC Academia.
In this comparison, we shall focus on their CIC Academia education policy and see what it offers to parents.
- Jubilee Insurance
Jubilee insurance is one of the biggest players in Kenya and East Africa, offering life, health, general insurance, and investment products across several countries.
Among its most popular education-focused products is the Career Life Plus Education Plan, which will be our focus today.
Faida Elimu Insurance Plan is yet another education plan in their portfolio, which is a unit-linked life insurance.
- Old Mutual Kenya
Old Mutual is a major financial services and insurance company that offers life assurance, investment, retirement, and education savings solutions in Kenya.
Among its most popular education policies is the Elimika Education Plan, which combines disciplined savings with life insurance cover.
Old Mutual also offers Lengo Education Plan, but in our education insurance policies comparison, we shall only focus on their Elimika education plan.
- Sanlam Kenya
Sanlam Kenya is a well established insurance and financial services provider that offers life insurance, savings, investment, and education-planning solutions.
Among Sanlam's most recognized education-focused plans include FlexiAcademic Plus and Go Educator.
In this comparison, we shall focus on their FlexiAcademic Plus.
Detailed Comparison of Education Insurance Plans in Kenya
Britam Msingi Poa Education Plan
Britam Msingi Poa Education Plan is one of the best education policies in the market.
The policy has high savings returns and has a premium holiday of 3 years.
Msingi Poa has a policy term of between 8 to 22 years and pays 4 bonuses in the last 4 years of the policy term (during which you enjoy the premium holiday - you do not pay the regular premium contributions as you receive the bonuses to clear school fees and related education costs)
The plan has a life cover against permanent disability due to illness and accident and a death cover.
If any of these unfortunate events happen in a policyholder's life, the policyholder stops making the regular contributions (premium waiver) and the maturity benefits are paid when due.
An immediate payout is also made when any of these unforeseen events occur which is equivalent to the sum assured.
A policyholder qualifies for a cash surrender value when Msingi Poa policy is more than 2 years old.
Msingi Poa Strengths
- Msingi Poa is one of the best education policies in the market with considerable returns. It gives a premium holiday of 3 years which is pure saving returns and 4 guaranteed bonuses/payouts for 4 years.
- It is designed to offer a long savings period that well aligns with the most cash demanding education levels such as the tertiary level and IGCSE O&A-levels combined.
- Life protection against permanent disability and death
- Premium waiver and an immediate lump sum in case the policyholder suffers permanent disability or dies.
Msingi Poa Limitations
- High premiums. The minimum premium contribution is KES 3,000. This might be prohibitive for low income families. However, it aligns well with the rising cost of education due to inflation.
Msingi Poa education policy best suits middle-income families, employees with considerable stable income and parents looking for structured savings with high returns.
Britam Boresha Elimu Education Plan
Britam Boresha Elimu plan is yet another education policy with high returns and adequate life protection.
It is designed to cover education levels that take 3 years to complete such as IGCSE Lower Secondary, CBE Junior and Senior Secondary, and tertiary levels that take 3 years.
It has a policy term of between 6 and 18 years and offers 3 bonuses/payouts in the last 3 years of the policy term.
In the last 2 years of the policy term when you are receiving bonuses, you do not pay the regular premium contributions. You enjoy a 2-year premium holiday.
Just like Msingi Poa, it features a life cover against permanent disability as a result of illness and accident and death.
In the event of these unfortunate happenings, you stop paying premiums (premium waiver) and the maturity payouts are paid when due guaranteeing the future education of your kids.
Under Boresha Elimu, a policyholder qualifies for a cash surrender value when the policy is more than 2 years old.
Boresha Elimu Education Plan Strengths
- Considerable savings returns and a 2-year premium holiday giving you peace of mind when you need it most.
- Life protection against permanent disability guaranteeing your future education goals.
- Premium waiver in the event of the unforeseen events of permanent disability and death ensuring your children receive education whether you are there or not.
Boresha Elimu Plan Limitations
- The starting minimum premium is KES 3,000 per month. The amount can lock out parents in low income households.
Boresha Elimu is suitable for middle-income families, employees with considerable stable income and parents seeking structured savings.
CIC Academia Education Plan
CIC Academia is an open ended education policy with 5 annual maturity payouts paid as a percentage of the sum assured, covering 5 years of future education costs.
The first 4 payouts are equivalent to the 15% of the sum assured and the 5th payment is 45% of the sum assured, totalling to 105%.
The policy has a minimum starting amount of KES 2,000 and the policy term starts from 9 years to 18 years.
CIC Academia plan is almost similar to Britam Super E that offers 6 payouts, paid as a percentage of the sum assured totalling to 130% in the last 6 years of the policy term.
However, CIC Academia and Super E are both inferior to Britam Msingi Poa and Boresha Elimu in terms of savings returns under the same policy term.
CIC Academia life cover offers permanent disability and death protection.
In case these unforeseen events occur in a policyholder's life CIC pays 50% of the sum assured immediately and all accrued bonuses are paid. Future premiums are waived.
A policyholder qualifies for a cash surrender value when the policy is more than 3 years old.
CIC Academia Education Plan Strengths
- Adequate life protection of the policyholder guaranteeing future education of your kids.
- Has a starting minimum of KES 2,000, lower than both Msingi Poa and Boresha Elimu which both have a minimum starting premium contribution of KES 3,000.
CIC Academia Education Plan Limitations
- Has lower savings returns as compared to Britam's Msingi Poa and Boresha Elimu and the similar Britam Super E. Msingi Poa is way far ahead than all.
- Higher cash surrender value period. Policyholders qualify for a cash surrender value when the policy is 3 years old as opposed to 2 years in Msingi Poa and Boresha Elimu.
CIC Academia education policy is suitable for budget-conscious parents and first-time policy buyers.
Old Mutual Elimika Education Plan
Old Mutual Elimika Education Plan is an endowment policy with a policy term of between 5 to 21 years.
The minimum starting premium contribution is KES 2,500.
The maturity payouts are staggered with a cash surrender value after 2 years.
The policy has life protection. In case the policyholder dies, premium contributions are waived and the staggered maturity payout are paid when due.
Elimika Education Plan Strengths
- The policy has lower starting premium contribution of KES 2,500 as compared to Msingi Poa and Boresha Elimu
- The plan has life protection against death
Elimika Education Plan Limitations
- The policy has no life protection against permanent disability due to sickness or accident when compared to Msingi Poa and Boresha Elimu.
- Savings returns are lower than that of Msingi Poa and Boresha Elimu on the same policy term.
It is suitable for parents wanting investment exposure.
Jubilee Career Life Plan
Jubilee Career Life Plan is an education policy with a policy term of between 5 to 20 years.
It has a minimum sum assured of KES 200,000 and the premium contributions are paid regularly.
It has life protection against permanent disability and death.
At maturity, the policyholder is paid a lump-sum.
This policy has scanty details, and for that I will leave it at that.
Side-by-Side Comparison Table For Top Education Insurance Policies in Kenya
| Feature | Msingi Poa | Boresha Elimu | Super E | CIC Academia | Old Mutual Elimika | Jubilee Career Life Plan |
|---|---|---|---|---|---|---|
| Minimum Contribution (KES) | 3,000 | 3,000 | 3,000 | 2,000 | 2,500 | – |
| Payout Structure | 4 Bonuses Each Equal to Sum Assured | 3 Bonuses Each Equal to Sum Assured | 6 Bonuses Totalling to 130% | 5 Bonuses Totalling to 105% | Staggered Payouts | Single Lumpsum |
| Flexibility | 8-22 years | 6-18 years | 10-25 years | 9-18 years | 5-21 years | 5-20 years |
| Protection Cover | Death + Permanent Disability | Death + Permanent Disability | Death + Permanent Disability | Death + Permanent Disability | Death Only | Death + Permanent Disability |
| Returns Potential | High (Best) | Moderate | Low | Low | Low | – |
| Best Suited For | -Middle income families-employees-Parents looking for structured savings-Those looking for the best education insurance policy-IGCSE & CBE primary levels-IGCSE O& A-levels combined-4-year tertiary/university level | -Middle income families-Employees-Parents looking for structured savings plan-IGCSE & CBE primary levels-IGCSE Lower Secondary-CBE Junior Secondary-CBE Senior Secondary-3-year tertiary/university level | -Middle income families-Employees-Parents looking for structured savings-IGCSE & CBE Primary level-CBE Junior and Senior Secondary levels combined | -Budget conscious parents-CBE & IGCSE primary levels | -Middle income families | All levels of education in CBE & IGCSE |
| Recommendation | Highly recommended | Highly recommended | Recommended | Recommended | Recommended | – |
| Get Quote | Get A Quote | Get A Quote | Get A Quote | Get A Quote | Get A Quote | Get A Quote |
Which Education Insurance Plan Is Best for You?
For low-income earners
All these education policies are almost similar in terms of the minimum starting premium contribution. They range between KES 2,000 to KES 3,000.
If you are budget-conscious, CIC Academia has the lowest starting premium contribution of KES 2,000. However, you risk waving away better returns offered by Msingi Poa and Boresha Elimu.
For middle-income families/Employees
If your income is relatively good and steady, Boresha Elimu is the best suited education policy for you.
It offers better savings returns than any other policy here, followed by Msingi Poa.
For high-income earners
If you are a high-income earner, go with Msingi Poa or/and Boresha Elimu. They offer better savings returns and are designed to adequately cover both CBE and IGCSE education levels.
For parents who want maximum protection
If you are looking for maximum protection, go with Msingi Poa, Super E, or CIC Academia.
They offer life protection against permanent disability and death, and make an immediate payment if any of these unforeseen events occur.
You can also include optional/additional life cover benefits as you enroll in most policies that I have covered here.
Common Mistakes When Choosing Education Insurance Plans
When choosing an education insurance policy, parents often make mistakes that can be costly.
I have previously written an article about it. And for that reason, I will just highlight the common mistakes that parents make when picking an education insurance policy, which include:
- Choosing based only on brand reputation
- Ignoring inflation
- Not checking payout timing
- Not understanding surrender penalties
- Underestimating long-term commitment
You can read a more detailed write-up by following the immediate link above.
Education Insurance vs Other Education Savings Options
In other articles, I have also compared education insurance policies against money market fund, Sacco Savings, and chamas contributions.
Following the links to learn more from the comparisons.
FAQs About Education Insurance in Kenya
- Which is the best education insurance plan in Kenya?
For the best returns and greater life protection pick Msingi Poa. If you are budget conscious, pick CIC Academia, though you will leave money on the table which you need most.
- Can I withdraw early?
Yes, you can withdraw early through a cash surrender value option stipulated in the policy documents of your preferred education policy. A cash surrender value option is where you receive up to 85% of your savings as a penalty of withdrawing early before maturity.
- What happens if I stop paying?
If you stop paying your regular premium contributions, what happens depends on the age of your policy.
If your policy has a cash surrender value after a particular number of months and you stop paying after that stipulated period, you can pick the cash surrender value option or a paid-up option. I described the cash surrender value option immediately above.
A paid-up option is where you allow the premium contributions you have made to stay with the insurance company until the policy matures where you shall receive lesser maturity payout(s) and no penalty will be subjected to your savings.
- Are returns guaranteed?
Yes. If you make all premium contributions as per the policy schedule, the maturity payouts are guaranteed as stipulated in the policy documents.
- Is education insurance better than savings?
Yes. Most normal savings plans have very low to no savings returns and do not offer life protection against unforeseen events in one's life like education insurance policies.
Some education insurance plans have very good returns with great life protection such as Britam Msingi Poa and Boresha Elimu Education Plans.
