•Underwriters have been urged to work closely with tech firms to develop mobile phone-based products to match the high penetration level in the country
•Insurance Regulatory Authority (IRA) data shows penetration remains at a low of 2.7 per cent amid high costs of premium, fraud, mistrust and ignorance by Kenyans
Lack of the right insurance products to meet the local demand coupled with high premiums is to blame for the low indemnity penetration in the country, experts have argued.
This has left majority of the population uncovered exposing them to risks mainly in businesses, agriculture, and health where majority of Kenyans cannot afford insurance covers.
UK-based consultant firm MarketMinds says there is need for local and international insurance firms and businesses to research on the best products that will meet the expectations of Kenyans, both on affordability and solving their problems.
According to MarketMinds CEO Sebastian De Zulueta, underwriters should also work closely with tech firms to develope mobile phone-based products to match the high penetration level in the country, where mobile money services and financial technology is equally evolving fast.
“Tech firms are expected to use technology to find the right people and get markets for companies. There is a huge opportunity in Kenya where companies can offer cheaper premiums as low as two dollars (Sh200),” Zulueta said.
“If you have two dollars premiums being distributed through mobile platforms, the volumes are high and the insurance company can make sustainable business while reaching many people,” he added.
He was speaking at the Deputy UK High Commissioner to Kenya's Nairobi residence on Monday evening, where over 30 startups gathered to pitch their businesses to potential investors in insurance, business management and financial sector.
Insurance Regulatory Authority (IRA) data shows penetration remains at a low of 2.7 per cent amid high costs of premium, fraud, mistrust, and ignorance by Kenyans.
The insurance sector has also been hit by non-payment of claims where at least 10 companies out of the 62 underwriters in the market are said not to honor contracts, despite collecting monthly premiums from customers.
“Insurance firms should find out what Kenyans want and give them these products at affordable rates. They should also ensure prompt settlement of claims to remain in good books,” said Toby Hanington, Founder-The Baobab Network.
To monitor inventories, insured properties, and client data well, insurance firms have been urged to invest in modern property and asset management systems.
“Automating your processes reduces your administrative workload ensuring your properties and assets are managed and maintained more efficiently and effectively,” said Lena Rosenior, CEO De Graft Management (DGM).