The Covid-19 pandemic has some far-reaching impacts to the economy of Kenya, and should the pandemic persist for the months ahead the country is likely to experience a recession.
The Government of Kenya has already laid out a raft of measures to protect the public against the economic impacts of the outbreak. The measures are largely tax incentives which are expected to cushion the public against adverse financial strains that they may experience.
The insurance and pensions industries are likely to be adversely impacted by the outbreak in both short and long-term. The two industries not only provides a safety net for insured lives, but also provides funds for investment in the financial markets as well as providing employment for the Kenyan population. Consumers of insurance and pensions products are likely to face challenges servicing their products and are therefore at risk of losing their covers as a result.
“Actuaries have unique skills to model and, consequently, quantify the financial impacts of such pandemics in the interest of the public and private institutions. It is for this reason that The Actuarial Society of Kenya (TASK), through its Covid-19 TASK Force has been formed to support the government assess the potential risks that the public, insurance and pensions industries will be financially impacted by the outbreak,” said TASK’s President Moses Mutuli.
The Actuarial Society of Kenya, TASK, was registered in the year 1993 and was officially launched in 2005. TASK brings together qualified and trainee actuaries in professional, educational and research organizations with an aim of promoting the actuarial profession in Kenya and East Africa.
This document represents the first phase of TASK’s proposals that relate at a high level the initiatives that may be undertaken by government institutions to cushion the public against adverse impacts of the Covid-19 outbreak. TASK’s view, as expressed in this phase of proposals, is that a consideration for financing for short term food security or income security to the population need to be urgently implemented especially if tougher social distancing measures continue to be implemented. Also crucial is financing to rapidly enhance the health infrastructure.
The first proposal has been submitted to the National Treasury and other relevant stakeholders at the fore of responding to the coronavirus pandemic.
The second phase of TASK’s proposal, which will be delivered in early May 2020, will focus on the modelling of the pandemic and its impact on the healthcare system in Kenya. Further information on this is highlighted in this attached document.