The performance of Kenya’s insurance sector has surged with a recorded written premium of Sh157 billion in the 2014 financial year compared to year 2013 which recorded Sh130 billion.
According to the Association of Kenya Insurers (AKI) industry report, the sector is projected to grow to Sh200 billion in written premiums by end of 2015.
The surge is attributed to favourable macro-economics and alternative distribution channels such as bank assurance and micro insurance, which contributed in premium payment convenience.
An insurance survey report by Think Business magazine showed the industry’s market penetration last year stood at 2.93 per cent, with a projected penetration of 3.5 per cent this year. “The last financial year saw tremendous changes in the insurance market.
The major ones were mergers and acquisitions, which saw underwriters in the industry seek consolidations and collaborations to spur growth in line with more advanced markets on the continent such as South Africa and Mauritius where insurance penetration stands above five per cent,” said the magazine.
“Mobile and technology advancement will enhance the distribution channel in the industry.” The AKI report further showed that life insurance premium growth in Africa slowed to 1.6 per cent in 2014 from six per cent in 2013.
Kenya’s life insurance premiums registered 29.4 per cent growth with Sh56.97 billion while non-life insurance grew 15.7 per cent to Sh100 billion.
Growth in South Africa, one of the largest markets with 87 per cent of the region’s premiums, slowed to an estimated 0.9 per cent from 6.2 per cent in 2013 attributed to slow economic activity and high inflation.