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Kenyan insurer seeks to curb fraud

NAIROBI, Kenya, Jun 16 – As part of its objective to take charge of the claims process and consequently reduce fraud cases REAL Insurance has introduced a Motor Assessment Centre, where accident vehicles will be assessed and the extent of damage established in monetary terms.

Chief Executive Officer Joseph Kiuna said pre-insurance inspection will also be carried out at the centre, as the company seeks to streamline the process from accident to repair for all their motor insurance clients.

“When a client brings in their vehicle for assessment, we will determine the repair costs, and invite garage owners to bid for the job, a process that is expected to be turned around within 24 hours. The most competitive quote will then get the job,” he explained of the center which is the first in the country.

The centre, located on Lanet Road in Nairobi’s Industrial Area and which has been put up at a cost of Sh10 million, has the capacity to assess up to 50 vehicles at a time. 

“REAL Insurance is proud and excited to launch the assessment centre in the country. This innovation will help us deliver tangible value to our clients, as well as generate significant savings for the company,” the CEO added.

Motor assessment centers, he explained are common in South Africa and Botswana where they have managed to achieve up to 20 percent savings in motor repair costs.

Mr Kiuna added that plans are underway to build other centers across the country within the next two years with Mombasa and Nakuru being among the first beneficiaries.

The launch of the motor assessment centre comes as part of the company’s strategy to improve operational efficiency. It is also meant to stem the spiraling motor accident claims that continue to affect general insurers in the market.

While the industry made an underwriting profit of Sh805m in 2008, motor private class made a net loss of Sh1.2 billion in the same year resulting largely from paying the many fictitious claims filed by service providers who manipulate their quotations.

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The loss ratio in this class was at 83.5 percent during the same period which was an increase of loss ratio of over 10 percent from 2007. This has been the trend over the last four years hence there is need to introduce measures that can reverse this.

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