Insurance
From The Report: Kenya 2014
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Holding enormous untapped potential, Kenya’s insurance industry has expanded rapidly over the past 10 years, with both the life and non-life segments showing consistent double-digit growth. As of early 2013 there were 47 operating insurance companies in Kenya, including 24 non-life businesses, 11 life insurers and 12 composite firms. Although the sector is still dominated by the short-term motor segment, rapid uptake in life, medical and new micro-insurance products has seen lower-earning Kenyans gain coverage. The industry, however, faces formidable challenges – premium undercutting has put intense pressure on major players, while fraud and low penetration have hurt margins and prevented nationwide expansion of comprehensive coverage. Nevertheless, the market holds considerable promise in the medium and long term. The expansion of coverage to lower-income groups via micro-insurance products also promises new opportunities to expand the market.

This chapter contains an interview with Tom Gichuhi, CEO, Association of Kenyan Insurers (AKI).

Articles from this Chapter

Overview

Premium growth and expanded coverage are expected
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Holding enormous untapped potential, Kenya’s insurance industry has expanded rapidly over the past 10 years, with both the life and non-life segments showing consistent double-digit growth as the nation’s rising middle class becomes increasingly aware of the benefits insurance entails. Although the sector is still dominated by the short-term motor segment, rapid uptake in life, medical and new micro-insurance products has seen lower-earning Kenyans gain coverage. The industry faces formidable…

Interview

OBG talks to Tom Gichuhi, CEO, Association of Kenyan Insurers (AKI)
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Interview:Tom Gichuhi What is the anticipated impact of the New Insurance Act in Kenya? TOM GICHUHI: With the new act, the Insurance Regulatory Authority (IRA) will be under the umbrella of the Financial Regulatory Council, following a shift to a risk-based solvency model. Meanwhile, licensed insurance providers will be required to join trade associations such as the AKI, which would assist in overseeing compliance. When enacted, the new law will be a major departure from the current legislation…

Analysis

Takaful products are set to secure livestock
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As Islamic financial products become increasingly popular in Kenya’s financial landscape, sharia-compliant agricultural insurance offerings are poised to make a significant impact on food security in the country. Kenya’s sole takaful provider has witnessed strong growth since its inception in 2011, setting a precedent for future expansion. Islamic finance, which adheres to religious principles including bans on interest and gambling, has witnessed rapid international growth in recent years.…

Analysis

Diversification into new lines and expansion into new markets underpins growth
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Insurance activities in Kenya have seen rapid expansion over the past decade, with the sector consistently witnessing double-digit growth. This is expected to continue on the back of overall economic expansion, a burgeoning middle class, untapped potential within the life insurance segment and new opportunities for project insurance. While hampered by low penetration and fraud, the country’s potential as a high-value destination for insurance investment has garnered international attention in recent…