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“People will gradually realize the convenience and benefits of onl.kz”

Onl.kz portal, a new modern instrument for customers’ convenience, appeared in the Kazakhstani insurance market this year. Madi Shalgimbayev, the Board Deputy Chairman of JSC Nomad Life, shared in his interview with lifeinsurance.kz the advantages of the electronic resource, benefits of compulsory insurance of employees and employers’ liability in case of failure to conclude a CAI contract.
“People will gradually realize the convenience and benefits of onl.kz”

- Madi, what new opportunities does your new portal onl.kz provide? What goal do you want to achieve by creating this site?

- First of all, it is about convenience and efficiency. The employers do not have to spend time on calls to the manager and wait; it is enough to have an electronic digital signature (EDS) for a quick procedure passing on our website. Digitalization is gradually penetrating Kazakhstan; you no longer need to go to the Public Service Center or tax office, wait in the line to get the necessary certificate or pay the tax. According to the experience of large digital systems operating in the country, our specialists have developed a new service. Thus, we have taken another step towards customers. Our clients can be absolutely sure of confidentiality, since access to the personal account is open only with EDS. A good advantage for those who conclude a contract through our website will be the opportunity to get a discount of up to 40%, in the absence of insurance claims for the last 5 years.

- Why, there has not been such a service in Kazakhstan until today?

- As of this January the contracts for all compulsory insurance classes apart from crop farming insurance and employee insurance against accidents (CAI), have been switched to electronic form, according to requirement, a complete transition to online form. As of 2021, any intermediary activity on legal entities will be banned in CAI, and sooner or later the market will switch to electronic resources. I would like to note that we are still the first and only company among LICs that have created a resource for the remote conclusion of compulsory employee insurance contracts.

- Why do you think our employers are still not in a hurry to conclude CAI contracts although they are beneficial both for them and their employees?

- The reach of compulsory insurance of employees in Kazakhstan does not exceed 50%. These are mainly large and medium-sized companies; small business is practically not involved. Life insurance companies raised this problem before the Ministry of Labor and Social Protection of the Population of the Republic of Kazakhstan, that in order to increase the employer's responsibility, annual reporting is required confirming the existence of a CAI agreement. However, CAI is a compulsory type, and the absence of a contract incurs a fine of 10 to 1000 MRI, depending on the organization.

What is going on now? A business owner, employer, who has not insured his employees, hides the facts of accidents that occurred to employees in order to avoid liability. Then such un-abiding employers refuse to help the dependents of the injured employee. Even if they do, it sometimes does not exceed the victim’s one salary. Let us take a look at an example of what the relatives of the injured employee would get if the organization had a CAI contract:

The organization staff consists of 3 people with an average salary of 80,000 tenge. There has been a fatal accident with one of the employees. He had two minor children left. The insurance company will pay them about 10 million tenge (payments will be made by instalments until the children reach the age of majority, and in case of admission to the university/college for full-time education, the payments will last up to the age of 23), plus the payment for burial - 100 MCI.

The turnover of the organization which the deceased had worked for was 3-4 million per year. Doubtfully, the employer was able to pay out such an amount to the victim’s family?

- To understand the value of the matter could you give the costs of your CAI programs for different cases? What determines the price and how these prices are adequate to the market?

- The minimum cost this year has amounted to 42,500 tenge (1 MS). The rate depends on the type of organization’s activity, size of the annual wages fund, the presence or absence of insurance events. Tariffs for all mandatory types are regulated by law.

- Why is your company trustworthy?

- Nomad Life has been in the life insurance market for over 10 years. It is part of the Nomad Insurance Group holding, together with Nomad Insurance, another successful insurance company in Kazakhstan, i.e. our group deals exclusively with insurance. Since 2012, we dominate in the life insurance market in almost all financial indicators. Our company is the only company in the industry included in the list of bona fide and reliable suppliers of JSC Samruk Kazyna.

- What is the volume of CAI contracts your company has already concluded at the moment? How many payments have already been made for insurance claims and for what amount and period?

- According to the last year results, Nomad Life owned the lion's share of premiums on compulsory insurance of employees (45%). During the validity period of this product (since 2012) we have collected more than 84 billion tenge and paid more than 18 billion tenge.

- What are the plans for the new portal in the nearest future? What the CAI market in Kazakhstan will look like in the next 2-3 years?

- The main goal is to popularize compulsory insurance of employees. Based on the fact that fees are growing every year and the number of insured enterprises is increasing, we assume that the CAI growth will be at least 5% per year. As for our portal onl.kz, we realize that in the first year we will not be able to transfer all contracts to the remote site, but gradually people will understand the convenience and benefit of the service. Our portal will provide the opportunity for each company to independently conclude a contract and save time significantly. Legal entities in insurance mainly work with intermediaries who will keep silent about legal discounts in CAI, therefore we recommend all current and potential customers to use our new service.

 

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