The effects of HIV/AIDS on performance of Insurance firms in Kenya

Abstract

HIV/AIDS has detrimental effects virtually on all aspect of firm thus negatively affecting firm performance. The most affected area is the human resource. HIV/AIDS has led to decline in performance of insurance firms by reducing labour performance and productivity through absenteeism, labour turnover, increased mortality rate, ill health, stress, early retirement, and alteration of organization's culture. The study sought to find out the effects of HIV/ADDS on performance of insurance firms in Kenya. The research has revealed the impact of the scourge on firms operational cost, performance and productivity of labour force and policy formulation. The targeted population was 43 insurance companies operating in Nairobi area. The firms chosen were those with branches in all other major towns in the country and stratified as life and general insurance companies. The association of Kenya insurers (AKI) was used to get a list of all the insurance firms operating in Nairobi. The 43 insurance firms were taken as the sample of the study The research targeted the human resource managers of the sampled firms. Data was collected through questionnaires which were given to human resource managers of each firm in Nairobi. The collected data was analyzed by descriptive statistics with the aid of statistical programmes for social sciences (SPSS). The study has revealed that all the firms under study have been affected negatively by HIV/AIDS scourge. The sampled firms indicated that the impact of HIV/AIDS scourge is serious and need to be addressed effectively. The research has concluded that HIV/AIDS has indeed negatively impacted on insurance firms in Kenya. The effects if HIV/AIDS pandemic have been manifested in increased cost of operation due increased cost in the following areas-: Recruitment, Training, Medical cost, funeral cost, HIV/AID counseling and testing and creation of HIV/AIIDS awareness among the staff. The scourge has also lowered labour productivity through absenteeism and labour turnover and has forced insurance firms to increase the cost of insurance premiums and develop new polices to counteract the effects of HIV/AIDS pandemic. The researcher recommends that the insurance firms set up mechanism to assist the management on how best to manage and control the scourge, insurance firms need to get acquainted with the ILO polices and other government policies that protect employees who are infected against discrimination and segregation. Finally insurance firms should formulate policies that ensures all the employees are insured irrespective of their HIV/AIDS status