OPINION: Little-known facts about education policies

As Kenya transitions through education reforms, the cost and complexity of education are becoming more apparent.

Among other things, there is a question of funding that is required by schools to uphold good standards of education for their students, and also funding needed by parents and the government to enable activities in schools.

While talks are ongoing to ensure that no student is left behind because of a lack of school fees, reports show that some guardians are struggling to keep their learners in school.

If not the cost of school fees, they worry about books, uniforms, activity fees, among other things.

This situation is not new, and it brings to mind the role that education insurance plays in ensuring uninterrupted education for learners.

Education insurance plans offer a structured way to cover learning costs. They combine long-term savings with insurance protection, ensuring that funds are available for school fees even in the event of unexpected circumstances such as illness, disability, or the loss of a breadwinner.

This financial certainty can protect a child’s education journey from disruption and give guardians peace of mind.

Beyond these advantages, however, there are three other, less discussed benefits of having an education insurance plan.

Tax relief

Having an education plan, like many other policies, means that you enjoy tax relief.

The government has provided a relief of 15% on monthly insurance premiums for policyholders, helping reduce taxable income.

This tax relief is an important incentive designed to encourage Kenyans to save and plan for long-term financial goals such as education.

When you contribute to an education insurance policy, a portion of your premium qualifies for tax relief, meaning you pay less tax while building a dedicated fund for your child’s schooling.

Waiver of future premiums in certain circumstances

One of the most powerful benefits of education insurance is the protection it offers if a parent or guardian passes away or becomes permanently disabled.

In such an event, depending on the insurance company, all future premiums are waived, meaning the policy continues without any additional payments from the family.

Some insurers like CIC pay 50% of the sum assured immediately, together with all accrued bonuses, providing the family with immediate financial support.

This means that the beneficiary will still receive the full anticipated maturity benefits at the end of the policy term, ensuring that their child’s education fund remains intact.

This feature removes the financial burden from grieving families and guarantees that a child’s education plans are not derailed by unforeseen tragedy, a situation that we have seen in educational journeys in our communities.

Financial challenges do not necessarily mean losing the policy

Another advantage of education insurance is the paid-up policy, which refers to a feature that protects parents who may be unable to continue paying premiums due to financial challenges.

Once the policy has gained sufficient cash value, parents can stop making further payments, and the insurer will keep the policy active until it reaches the end of the agreed timeline.

This ensures that parents do not lose the savings they have already built for their child’s education. It offers flexibility and financial protection, allowing families to preserve their child’s education fund even during difficult economic periods.

There are different education insurance policies offered by various insurers, and one can choose the one that matches their financial goals, risk level, and financial muscle.

For instance, CIC Academia is designed for long-term planning, and with as little as Ksh.2,000, you can choose how much to contribute and how long you want to save.

When the CIC Academia policy’s saving timeline ends, you receive a lump sum to cover school fees, college expenses, or even a child’s first year at university, with access to a loan facility as part of its benefit package.

The writer is Meshack Miyogo, MD at CIC Life Assurance Limited