Challenges Hindering Profitability in Kenya’s Insurance Sector

The Insurance industry in Kenya can be termed as Africa’s most well-developed example with the best-regulated markets. The sector, with its challenging historic growth, has for years gained traction with better near-term prospects, popularity, and expansion. However, it remains fragmented and there is no denying that many are struggling to stay ahead of the competition.

It faces a myriad of challenges with increasing regulatory capital requirements being among them. Despite the growing scope for consolidation and profitability, some people have associated insurance with fraudulence.

As it would seem, the sector is the easiest to venture into, which isn’t surprising as it is among the top employers in Kenya. Salespeople, insurance educators, administrators among others are flooding the market and it isn’t surprising to encounter new insurance companies once in a while.

The downside is that people are having it hard in terms of identifying firms that are genuine and those that are not. As a result, many individuals have fallen victims of signing contracts for non-existent insurance covers.

Although the Insurance Regulatory Authority ensures that such fraud cases are properly handled. That is one of the challenges rocking the insurance industry in Kenya.

People hate lengthy procedures, and some insurance companies haven’t found a way to navigate around this issue. It is one of the reasons many get tired by the idea of getting a cover. Coupled with a feeling that the cover doesn’t work for the benefit of the citizen, others think twice about getting a cover regardless of whether it is life, healthcare, or general insurance.

Sadly, even after honoring your commitment to paying agreed premiums after the stipulated periods, some firms make the compensation procedure such a hassle that stresses one out. Some insurers dismiss cases of compensation without qualms leaving the insured hopeless and distressed.

These, among poor marketing strategies, untrained personnel, middlemen and brokers taking advantage of ignorant people, the little support from the government, and unregulated business activities give the insurance sector a bad rap.

This is not to say all insurance companies are inappropriate. There are those that work for the interest of their clients. They work seamlessly with the government, have been in existence for decades and have created confidence and trust among the people. A good example is the Kenyan Alliance Insurance Company among others.

Tracing its roots back to the year 1915, Kenyan Alliance Insurance has grown to be one of the most financially sound insurance companies in the country. It is a composite insurance firm that deals in General Insurance, Life Insurance Pensions, and Healthcare.

Apart from the Head Office at Chester House in Nairobi, Kenyan Alliance Insurance has other branches in the city at Bunyala Road and Brick Court, Mpaka Road, Westlands. Other regional representations are in Mombasa, Nakuru, Kisumu, Eldoret, Kitui, Karatina, Meru, Thika, Kakamega, Kenyan Alliance has further extended its operations with over 40 satellite offices set up in PCK offices all over the country.

Its existence and operations over the years have made it one of the companies to consider for an insurance cover.

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