The government has said it will set aside about Sh100 million to educate the public on insurance in order to boost penetration.
According to the Insurance Regulatory Authority, most Kenyans view insurance as an unnecessary cost.This is compounded by the unwillingness of insurance firms to invest in publicity.
IRA chief manager in charge of policy research and development Robert Kuloba said publicity is a heavy investment that most insurance firms are unwilling to undertake, inhibiting growth of insurance.
“We shall do the publicity for you. Then the market will be ready for you to take it up,” said Kuloba.
He said IRA has a dedicated budget for consumer education.
“We’ve not been as successful as we should in persuading people that insurance is an essential service that has a huge contribution to make in the society,” said Kiptum.
“More often than not as insurance players, whenever we give our value propositions to the market, we are often seen as an unnecessary cost,” he said.
He spoke during the opening of the 13th Association of Insurance Brokers of Kenya regional conference at Sarova Whitesands Hotel in Mombasa on Thursday.
AIBK chair Nelson Omolo said the country’s insurance penetration is at a paltry 3.5 per cent despite the many opportunities that the industry has, especially in the Big Four Agenda.
Last year, the industry failed to achieve its projected revenue target of Sh20 billion in premiums from the marine insurance, Omolo said.
Kuloba said about 70 per cent of complaints received at the IRA are due to misinformation.
“Those who complain are people who are learned but you realise if they understood the concept of insurance quite well, I’m sure they would not have made the decisions they made,” said Kuloba.
He said in most cases, the insurance firms are usually right in the end as customers realise they are the one with the mistakes.
“It is because of those gaps that, as a government agency, we have taken up that duty to undertake public education and awareness as a public good,” Kuloba said.