This archive report was first published on 12 September 2019.
On September 12, 2019, the insurance sector in Kenya reported a significant increase in net profit, rising by 138% to Sh5.7 billion in the second quarter of 2019.
This improvement was attributed to a decrease in claims from Sh27.7 billion to Sh27.2 billion, while premiums increased by Sh5 billion or four percent to Sh117 billion.
According to the Insurance Regulatory Authority (IRA), the sector was able to narrow its underwriting losses to Sh1.2 billion from Sh2.6 billion in a similar period last year.
Investment income remained a major source of insurance profits, with long-term business investment standing at Sh382.97 billion in June, an increase of 13.3% compared to Sh338.15 billion as at the end of Q2 2018.
“Kenya government securities (treasury bills and bonds) maintained their attractiveness to long-term insurers, comprising 67.3% (Sh257.56 billion) of the total long-term insurers’ investments,” IRA said.
General insurance business underwriting results improved significantly by 52.8% at the end of Q2 2019, recording an underwriting loss of Sh1.26 billion. Long-term insurance and general insurance segments grew by 6.9% and 2.9% respectively.
However, fraud continued to be a significant problem, particularly in motor vehicles claims, theft by agents, and medical fraud.
For the first six months of the year, IRA reported 60 cases of fraud, with June and February being the months most affected.
