Best Endowment Policies In Kenya: A Comparison

I assume you are here because you are looking for a disciplined way to save for a major milestone (buying land, building a home, building an education fund, starting a business) without exposing your capital to aggressive stock market volatility.

That is exactly what endowment policies do. An endowment policy gives you 3 things: guaranteed savings, bonuses ( savings returns), and life cover.

A life protection is mostly against death or permanent disability due to sickness or illness to the policyholder.

In case of these unforeseen events in one’s life, premiums are waived in their occurrence and the maturity payout and bonuses are paid when due.

There are various types of endowment policies depending on how they pay their maturity bonuses.

There are those that pay a single lump sum at the end of the savings period. These types of endowment policies are popular if you want to build a fund towards cash demanding financial goals such as buying a home, building an education fund, buying land, and starting a business.

The other type of endowment policies pay staggered bonuses or payouts (survival benefits) at defined stages some yearly or after a particular period of time e.g. after 4 years, 5 years etc. These are useful to people who want survival benefits early and fund their financial goals in a slow paced manner.

Note: Endowment policies can be classified in so many ways. Education policies are endowment policies, purposely designed for building an education fund. However, due to their purpose and nature, I have written a standalone article dedicated to them. You can read about education insurance policies here=>(best education insurance policies in Kenya) if your purpose is to build an education fund.

Today, we shall list and compare the most popular multi-purpose endowment policies in Kenya.

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Criteria: How we ranked the best ipolicies

To be eligible to be included in this list, there are certain thresholds each endowment policy has to pass.

• The insurer’s financial muscle. All companies holding these policies are Kenya insurance giants, starting with Britam, the biggest life insurance company in Kenya. Financial health is important as a scenario of going under is unimaginable. Your savings are secure.
• Historical bonus performance. This concerns how consistently has the underwriter paid or declared reversionary and terminal bonuses.
• Policy loan accessibility. Every policy here has that feature. That you can take a policy loan against your savings after a particular period of time within the policy term, usually after 3 years since the inception of your endowment policy.
• Premium payment flexibility and Savings Security. That you can choose how to make your contributions according to how your income gets in. And again, in case your income gets shaky, there are certain measures in place to ensure that your money is safe.

Having disclosed the methodology for inclusion, let us get into it and list and compare some of the top endowment policies in the market right now in Kenya.

Quick Comparison: Best Life Insurance Endowment Policies in Kenya

Detailed Review of the Top Life Insurance/Endowment Policies in Kenya

Britam Akiba Endowment Policy

Britam Akiba endowment policy is one of the top cash value life insurance in the market with great returns and adequate life protection against death.

Key Features of the Britam Akiba Endowment Plan

• The minimum entry age is 18 years and the maximum age is 65 years. It is mostly suitable for people under 50 years as they get the best cash value returns. The maximum age on cover is 70 years.
• The policy has flexible, regular premium contributions which you can make monthly, quarterly, semi-annually and annually, payable throughout the policy term. The premium starts at KES 3,000 per month.
• Akiba has a guaranteed lump sum payable on maturity of the policy which is funded by regular premiums.
• The policy offers terms of between 5 and 12 years, which the policyholder selects during policy inception.
•  When enrolling you can choose to go for a medical checkup or not. If you opt for a medical checkup, the sum assured you will receive at maturity is not capped. If you choose not to go for medicals, the sum assured you receive as the maturity payout is capped at KES 15,000,000.
• In the event of death, premium contributions are waived, and the sum assured or the maturity benefit is paid to the beneficiary maturity.
• If you had placed an optional death benefit, an instant payment is made when the death occurs, equivalent to the sum assured and the maturity payout is made when due.
• You can only opt out of this arrangement after 2 years where you shall receive a cash surrender value determined by the insurance underwriters. You can also choose a paid-up option, where you let the premium already contributed sit with the insurer and be paid together with some returns when the policy term ends. In this instance, you receive a lesser sum assured.

Why should you enroll in Britam Akiba Endowment Plan

• The plan offers high savings returns for people below 50 years compared to many to other savings insurance policies. Akiba offers the policyholder a guaranteed return of up to 7% net rate even when the market conditions are in turmoil, which is higher than what typical savings insurance products return.  
• Akiba has low policy terms with a minimum term of 5 years and a maximum of 12 years.  
• The product is designed with the policyholder in mind as it is easy to understand its structure and terms
• The policy allows for high entry ages of up to age 65. Most endowment policies allow a maximum entry age of 55 years.

Disadvantages of Akiba Endowment Policies

• The policy is not suitable for people with low and unsteady income. The minimum premium contribution is KES 3,000 and just like any other endowment policy, you must make the premium contributions as per the defined payment schedule.
• Akiba is not suitable for people above 50 years. It has lower savings returns due to the risk involved with age.
• The policy could have higher savings periods. The maximum savings period (policy term) is 12 years.

If you are 50 years and below, I urge you to really consider the Akiba Endowment Policy. It gives very fair returns and you can use it to save for school fees, or build a fund to meet your short and long-term goals, including retirement fund.

ICEA Lion Endowment With Profits

ICEA Lion Endowment with Profits is a savings life insurance plan where you receive a single lump sum payout at maturity.

Key Features of ICEA Lion Endowment With Profits

• The plan offers a guaranteed single lump sum payout at maturity.
• The plan minimum regular premium contributions is KES 2,000 and offers flexibility where you can choose to make your contributions monthly, quarterly, semi-annually, or annually.
• It offers life insurance protection including death, permanent disability cover, critical illness covers and last expense.
• You can access a policy loan after the policy is in force  for 3 years.
• You can add additional benefits besides the built-in including disability, death, and critical illness covers.
• If your income changes due to unforeseen circumstances, you can opt out after 3 years since policy inception through a cash surrender value which is determined by the insurance underwriters.

Why should You Enroll in ICEA Lion Endowment With Profits Plan

• The plan is quite affordable starting at KES 2,000 monthly premium contributions.
• The policy allows a lot of flexibility where you can choose to make your premium contributions monthly, quarterly, semi-annually, or annually. Again, if you had picked high premium contributions and income shrinks, you can reduce it to lower contributions down to KES 2,000.

Shortcomings Of ICEA Lions Endowment With Profits

• The policy requires regular premium contributions without failure. This makes it unsuitable for people with a shaky income.

ICEA Lion Endowment With Profits is suitable for short and long-term goals.

Fanaka Investment Plan

Despite the word investment, Fanaka Investment Plan is an endowment policy that combines life protection with a savings plan.

Fanaka Investment Plan Key Features

• The plan pays a single guaranteed lump sum amount at maturity.
• The plan term (savings period) is between 5 and 20 years.
• To enroll, the entry age is between 18 and 65 years old, and the maximum age on cover is 70 years.
• The policy allows a minimum sum assured of KES 350,000.
• Cash surrender value is offered after 5 years if the policy term you picked is between 5 to 10 years. If you picked a policy term between 11 to 20 years, the cash surrender value is allowed after 3 years.
• You can take a policy loan with this plan against your savings.

Why Should You Enroll in Fanaka Investment Plan

• You will get a guaranteed maturity payout at the end of the policy term.
• The plan has a high maximum savings period of 20 years, you can save for a long period of time to achieve your goal.
• The policy has a high entry age such that it can accommodate many people of different ages.

Shortcomings Of Fanaka Investment Plan

• The policy is unattractive because of the strict opt out conditions. The cash surrender value opt out option is set at 5 years and 3 years for terms between 5-10 years and 11-20 years respectively. This is not suitable for financially struggling policyholders.
• The minimum sum assured is KES 350,000 meaning it is not suitable for low income earners.
• The policy is complex to understand and can bring confusion.

Fanaka Investment Plan can help you save, but not suitable if you start struggling financially.

Old Mutual Hakika Savings Plan

Hakika Savings Plan is an endowment policy by Old Mutual that offers an extra long savings period of up to 43 years.  

Hakika Savings Plan Key Features

• The plan has a policy term of between 5 to 43 years and the policy term you can pick is determined by your current age.
• Hakika Savings Plan accommodates people between the age of 18 to 55 years.
• The policy minimum premium contribution is KES 2,500. You can make your premium contributions monthly, quarterly, semi-annually, or annually.
• With this plan, the policyholder receives a lump sum single payout at maturity (end of the policy term).
• The policy features death and disability covers and the premium contributions are waived in the occurrence of these two events.
• You can add death benefit and life cover as riders (optional benefits).

Why Should You Enroll in Hakika Savings fPlan

• The policy offers a very long policy term of between 5 to 43 years. This means you have a long saving period that you can use to achieve any goal.
• Hakika Savings Plan has adequate insurance protection against death and disability.
• The starting premium of KES 2,500 is considerably moderate, giving many a chance to save for their short and long-term goals.

Disadvantages of Hakika Savings Plan

• Low income earners or people with shaky income may not be able to save under this savings plan.
• The entry age of between 18 to 55 years is not wide enough and may lock out many people willing to save.
• Hakika Savings Plan may not have considerable savings returns like some of the endowment policies in this list, one being Akiba.

Hakika Savings Plan is a good plan for savers even if it is not the best in saving returns.

APA Insurance Imarika Fixed Saving Plan

Imarika Fixed Saving Plan is offered by APA Insurance and is a short to long-term endowment policy.

Imarika Fixed Saving Plan Key Features

• The plan has a policy term of between 5 to 20 years.
• It offers a single, guaranteed lump sum at maturity (end of the policy term).
• The entry age is between 18 and 65 years, and the maximum age on cover is 70 years.
• The Imarika plan features a death cover.
• You can add additional insurance protection including protection against permanent disability, accidental death, critical illness, waiver of premium due to disability, medical reimbursement in case of an accident, and retrenchment in case of loss of employment.
• The regular policy premium contributions can be paid monthly, quarterly, semi-annually, or annually.
• After 3 years, you can opt out through a cash surrender value determined by the underwriter or a paid-up option where you let the money sit with the insurer until maturity of the policy.
• With this plan, you can take a loan against the policy cash surrender value.

Why Choose Imarika Fixed Savings Plan

• The policy accepts a wide range of age groups from 18 to 65 years.
• The policy term is adequate to even save for the most cash-demanding long-term goals.
• Imarika Fixed Savings Plan allows you to take up a policy loan to attend to emergencies.

Shortcomings of Imarika Fixed Savings Plan

• The policy opt out period of 3 years either through cash surrender value or paid-up option is too long. Financially struggling policyholders may lose their savings as a result.
• Most of the plans’ insurance protections are not built-in, they are optional hence attract some more charges reflected on the premiums once selected.

If you choose to go with this plan, ensure you are financially stable and you will pay more for better insurance protection.

Madison Money Max Plus

Money Max Plus is a cash value life insurance policy by Madison that combines life protection with investment/savings.

60% of the regular premium contributions you make goes to life protection while the remaining 40% goes to building a fund that is invested to meet your future goals, with guaranteed return of 5% p.a. and a management fee of 2% p.a.

Money Max Plus Key Features

• The endowment policy has a policy term of 8 to 15 years.
• It guarantees a return of 5% p.a and a management fee of 2% p.a.
• With this endowment policy, you can decide to take a single lump sum at maturity of the policy term or staggered payouts (survival benefits equivalent to 20% of the sum assured) within the last 4 years of the savings period.
• Money Max Plus has a death benefit of 100% sum assured and a last expense of KES 20,000.
• The plan offers a permanent disability rider/option bought at an extra cost.

Why Choose Money Max Plus

• It gives an option to wait up to maturity to get the payout or collect early. For people struggling financially, this is a good option.

Shortcomings of Money Max Plus

• This plan smells very low returns everywhere. Look at how your premium contributions are shared (a whooping 60% goes to life protection), the guaranteed return rate of 5% p.a., and a management fee of 2% p.a.
• The minimum policy term of 8 years is too long for short-term savers.

Overall, I recommend Britam’s Akiba Savings Plan. Akiba Endowment Policy has generous savings returns, especially for those who are looking for a long-term savings plan of 10 years or more. The plan has also many restructuring options in case of a financial hiccup, early exit option, and you can easily access a policy loan via their customer app, “My Britam App”.

However feel free to pick the one that fits your preferences and needs.

Out of the 6 endowment policies that we have listed and compared, I am confident that one fits your description of an endowment policy.

If you need a quote, please fill the form above and I will share one with you in no time.

Thank you for being here.