Equity Group Holdings is eyeing a bigger pie of Kenya's insurance market , as it takes a shot at general insurance business.
This means Equity will be going into fire, marine, motor, accident and other miscellaneous non-life insurance underwriting
The lender has received in principle approval from the Insurance Regulatory Authority (IRA) to set up a general insurance company, in a move likely shake-up the market that currently has about 56 major players.
The application for a general insurance business license follows the successful launch of Equity Life Assurance Kenya (ELAK)– Life Insurance business last year.
In the nine months that ELAK operated upon receipt of a product licence, it recorded gross written premium of Sh3.99 billion.
It issued 4.1 million policies and posted a profit after tax of Sh281 million. Total assets stood at Sh5.5 billion.
It had a deposit administration of Sh339 million with a declared gross return of nine per cent for 2022.
It is ranked second on group credit life with a 24 per cent market share in credit life, eleventh in gross written premium out of 25 life insurance companies, with an overall market share of 2.97 per cent.
“The impact of the early success of the life insurance business inspired the board to seek the general insurance business licence in the hope that Equity Insurance business will contribute in innovatively transforming the insurance industry,” it said in a statement yesterday.
The board has appointed Jonas Mushosho as the inaugural Chairman subject to the approval of IRA.
Mushosho is currently the Insurance Trade Finance Programme Coordinator, Afri Exim Bank.
Previously, he has held various positions in Old Mutual including MD Old Mutual Life-Zimbabwe, Group CEO, Old Mutual-Zimbabwe, and managing director Old Mutual-Rest of Africa.
Insurance penetration in Kenya is currently at a low of 2.43 per cent, despite Kenya leading in the region on uptake of insurance.
It is followed by Rwanda with a 1.70 per cent penetration, Uganda (0.84 per cent), Burundi (0.77 per cent) while Tanzania has a 0.53 per cent penetration.
Insurance penetration in Africa is at 0.3 per cent.
There has been concerns over dubious schemes has seen the public remain suspicious about taking up insurance, despite its major role in socioeconomic development.
Premium undercutting by firms in a race to protect their market share is also a major challenge, with the trend blamed for underwriting losses in the industry.
