This archive report was first published on 26 September 2019.
Kenya's Insurance Industry Struggles to Grow Amid Economic Growth ¶
Published on September 26, 2019, at 22:00
The Kenya insurance industry is critical for socio-economic continuity, but it has been struggling to grow despite the country's economic growth. The industry's uptake of insurance products has been on a steady slide since 2013, touching a 15-year low of 2.43 percent of the gross domestic product (GDP) in 2018.
Heritage Insurance Company managing director Godfrey Kioi spoke to the Business Daily about the industry's challenges and how data is being used to understand customers better.
According to Kioi, the industry's growth is hindered by the low priority given to insurance by Kenyans. 'Insurance is still at the bottom of priorities for most Kenyans,' he said. 'If things get tough, it's the first thing that drops off the budget, in favor of things like loans.'
He also attributed the industry's sluggish growth to the lack of innovation and creativity in the industry. However, he noted that technology is helping to overcome some of the regulatory constraints that hinder innovation and creativity.
One of the key areas where the industry is using data is in understanding customers better. 'Data is an enabler that's helping us to know the customer more,' Kioi said. 'When you know the customer, you position your products appropriately and grow.'
The data is also being used to provide targeted services to customers. 'Even doing a simple thing like getting a customer's telephone number and being able to get back to that customer and call him by name, is a big step for us,' Kioi said.
However, Kioi acknowledged that the industry still has a long way to go in terms of using data to understand customers. 'The journey that we are embarking on is to ensure we use data analytics and social media knowledge to understand the customer's lifestyle,' he said.
He also emphasized the importance of ensuring that the data collected is not used to invade customers' privacy. 'Most of us are on social media and we share very personal information without a care in the world about our relationship,' he said. 'As an industry, we have asked that people share data with us. This data will be used for insurance purposes only.'
Regarding non-payment of claims, Kioi acknowledged that it is a damper to the uptake of covers. However, he noted that the industry is working to address this issue by making claims processing and settlement faster.
He also highlighted the importance of building trust with customers. 'If we can process claims in a seamless manner, we will build the trust in our customers,' he said.
Finally, Kioi spoke about the company's auto-correct motor policy, which has been received positively by customers. 'The customer of today wants to work with a brand that rewards her and be treated as an individual,' he said.
