Kenyan insurance products

Mashrukh Khan: Kenya’s insurance market recorded gross written premiums of Kshs 241.3 billion in H1 2025, up 13.4% from Kshs 212.8 billion in H1 2024, with the full-year 2025 figure reaching around Kshs 395 billion and penetration at 2.44% of GDP. The sector’s asset base grew 18.4% to Kshs 1.4 trillion, supported by economic recovery and regulatory reforms under the Insurance Regulatory Authority (IRA).

Life (long-term) insurance includes term, endowment, whole life, group life, credit life, deposit administration, annuities, and unit-linked or investment-linked plans for death benefits, retirement savings, and critical illness. Non-life (general) products cover mandatory motor third-party liability plus comprehensive for accidents, theft, and own damage; medical/health insurance as the largest class; property and fire insurance for buildings and contents against fire, theft, storms, floods, and collapse; liability; marine cargo (now mandatory for imports); personal accident; workers’ compensation under WIBA; travel; surety bonds; and emerging micro-insurance, index/parametric, and cyber covers.

Mandatory insurances require motor third-party liability for all vehicles, group life for employers, marine cargo for imports since February 2025, and professional indemnity or builders’ liability in specific cases, while private health, comprehensive motor, and property covers remain voluntary but widely adopted.

Clauses follow the Insurance Act (Cap 487) and recent IRA draft regulations, including the Insurance (Amendment) Regulations 2025 and proposed Claims Management Guidelines, which enforce utmost good faith, full pre-contract disclosure of material facts, and prompt policy issuance within five working days of premium payment. Non-disclosure or misrepresentation risks reduced payouts or voidance if material.

Exclusions typically cover intentional acts, war, nuclear events, gradual wear, and unendorsed perils. Claims must be acknowledged within two working days, with decisions and settlements targeted within strict timelines; ambiguities favor the insured, and insurers face penalties for unjustified delays or rejections.

Claims predominantly arise from motor accidents and own-damage (high volume due to road conditions, vandalism, and rising repair costs), medical treatments under health plans, property damage from fires, floods, storms, and theft, plus liability events. Non-liability claims dominate in number and value, with industry claims paid rising 34.6% to Kshs 67.6 billion in H1 2025.

Denials often stem from non-disclosure, late notification, suspected fraud, improper documentation, or policy exclusions, prompting IRA proposals for stricter rejection rules.

Premiums are risk-assessed: motor third-party starts at around Kshs 3,000–5,000 annually for basic cover, while comprehensive depends on vehicle value, type, driver age, history, and location (typically 4–8% of insured value); medical and property factor age, asset value, and peril exposure with recent increases in flood-prone areas; life ties to age and sum assured.

No-claims bonuses (up to 60%) and bundling offer discounts, though inflation, parts costs, and reinsurance pressures drive moderate rate hikes.

Claim values range from the lowest minor motor repairs or small thefts under Kshs 10,000 to the highest aggregates from major motor, health, or property events reaching billions of shillings, with motor and medical accounting for over 67% of general insurance premiums.

Regulated by the Insurance Regulatory Authority (IRA), the market features strong local players like Britam, Jubilee, CIC, APA, and Old Mutual, with general insurance contributing 53.8% of premiums in H1 2025. Challenges include low penetration, rising claim rejections, fraud, and climate risks, yet opportunities grow through digital channels, bancassurance, embedded insurance, micro-products, and index insurance for agriculture.