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Insurance firm Liberty Life Assurance Kenya will Wednesday launch a market retirement investment solution that earns retirees’ higher returns flexibly.
The firm’s new diversification plan, is aimed at growing its pension business, is informed by research on retirees concerns for retirement income schemes that can earn them post-retirement returns and continuing popularity of freedom and choice in pensions.
According to the 2019 FinAccess survey, there has been a drop in the share of Kenyans saving for retirement. Only one in four (23 percent) Kenyans aged 16 and above saves for old age, a decline by half from two in five (44 percent) in 2016, earning retirees’ less income, a third of what they were earning, in their active lives.
Kenya’s suspended Minister for Finance or Treasury Cabinet Secretary Henry Rotich announced in January last year (2018) during the launch of universal pension plan that everyone in Kenya over the age of 70 will be entitled to a new, guaranteed monthly income in his 2017/18 budge, saying that the initiative would operate alongside the existing scheme covering older people over 65 who live with a disability.
Rotich said that the experience gained from the ongoing cash transfer programme for the older people helped him decide to announce a universal pension. Introduced in 2007, the Older Persons Cash Transfer provides 2,000 Kenyan shillings (US$19) every two months to people over 65 who are poor, vulnerable and not in work or receiving any other kind of income.
The pilot project covers 203,000 households across three districts.
Kenya follows in the footsteps of Tanzania’s semi-autonomous island Zanzibar.