This archive report was first published on 6 October 2019.
On October 6, 2019, the Insurance Regulatory Authority (IRA) revealed that it had successfully blocked Sh310.48 million in fraudulent claims, primarily from motor vehicle owners and insurance agents.
According to the IRA's 2018 annual report, the blocked fraud was a result of enhanced surveillance and the efforts of the Insurance Fraud Investigation Unit (IFIU), which detected 91 cases in 2018, down from 168 the previous year.
Of the 91 cases reported, the majority (20) were related to motor vehicle insurance, involving fraudulent accident claims and fake car theft claims. Insurance agents were responsible for 19 cases, a significant decrease from the 56 cases reported the previous year, mainly due to theft and commission fraud.
The report noted that the previous year's data did not disclose the amount of money at stake. The IFIU was established in 2011 to combat insurance fraud.
Many insurers have expressed concerns that fraud has negatively impacted their profitability, kept premiums relatively high, and slowed down claims settlement pace. The Association of Kenya Insurers (AKI) suggested that the use of technology, such as blockchain, could help reduce fraudulent claims.
"The insurance sector is constantly dealing with fraudulent cases. Adopting blockchain from the onboarding process all the way to claims processing can help reduce manual intervention of information," said the AKI.
