Since 2012, Prévoir (Kampuchea) Micro Life Insurance Plc., or PKMI, has been evolving its brand of employee health and life insurance products, which are tailored specifically to meet the demands of Cambodia’s rapidly growing but still highly transient private sector.
Two years and some 30,000 policies later, the French-owned micro-insurer is inarguably leading the charge towards improving health benefits for Cambodia’s workforce by simply taking the risk out of the employee and the employer’s hands.
Solène Favre, chief executive of PKMI, admits that it will take some time to change the Kingdom’s appreciation for insurance products, but says the practical benefits of staff insurance products are already clear as day.
How widespread is the market for employee health insurance products here in Cambodia?
Most small businesses are not aware of insurance and don’t really understand the principles behind it. One of the most common responses we get from new clients is, “Why would I buy insurance if my employees are never sick?” Cambodia is a developing country and insurance is not yet embedded into people’s minds as a necessity or as a safeguard. That said, we expect this to change as more social advantages such as insurance and health benefits become increasingly ingrained into Cambodian management styles and as the Cambodian government also moves towards introducing compulsory insurance for all private companies.
So spell it out for us. What is employee insurance?
We cover business employees with a similar insurance solution to that of our regular customers – against all health and life risks such as hospitalisation and surgery fees, ambulance and doctor visits. The cover protects employees and their families from unexpected financial burdens and medical expenses, and secures their income during those periods. It covers the employees both at work and also outside of work. The cost of the insurance is paid by the employer.
The most common product that we sell to companies is the combination of health and life insurance, which is sort of a guarantee for companies that their employee will be able to receive good medical care and return to their position quicker.
Then what are the benefits and costs for an employer to adopt this kind of staff insurance?
We believe that insurance is a great tool to retain and attract the best employees in the market. By offering them good care, the emplovyees will feel safe and confident, which translates into them being more efficient at work. There are many other tools, of course, such as better salaries, flexible working hours and accommodation benefits, but we believe that insurance is equally as important.
Insuring staff certainly requires the right budget. The price really depends on the coverage that the employer chooses to give. At PKMI, we offer a wide range of insurance products to accommodate all levels of income starting from $6 per employee per year.
When we meet an employer, we firstly need to know their budget before we start designing a policy that is right for them. If they want to insure their staff more for surgery, or life, or whatever, then the premium is calculated to reflect that.
What are the risks that private companies run if they continue without insuring their staff?
While the government does demand by law that companies should be insured for employees injured on-site, there are no regulations yet in Cambodia that demand firms to offer employee insurance like ours. However, it is part of their planning to make health insurance compulsory to all companies in Cambodia in the coming years. So at the moment, there are not specific risks for a private company if they do not insure theiremployees.
But certainly one issue is the high turnover of employees or potentially losing staff to competitors who do have such benefits. What we hear time and again from employers is that they have a very fast turnover of staff. If you look after the employee, they will stay longer.
Also, there has been a trend towards a sort of in-house insurance scheme, whereby companies would simply pay for employees if they get sick. But say you have a workforce of 15 staff, and one after the other becomes ill, that can become very costly for the company. So outsourcing and mitigating that risk, we think, makes employee insurance worth it.
So far, what kind of uptake has PKMI seen from private businesses? Do a lot of companies choose to insure their staff?
Mostly international-standard companies have insurance for their employees, but we are increasingly noticing that local firms are starting to catch on and insure their staff. Our challenge is to show that every business, from the large international ones to the small local ones, can use employee insurance products to achieve long-term goals instead of trying to overcome short-term staffing obstacles.
As of July this year, we had about 30,000 effective policies.
All the companies that have joined us so far have renewed their policies. It is a sign of both the management mentality changing and a general satisfaction with the PKMI product. For employees, we are increasingly seeing a demand for insurance to be included in their salary packages – they ask, “Is employee insurance included?” And even on the job websites, we see insurance now as one of the advertised perks of a job advertisement.
Text and Photograph by Eddie Morton