NAIROBI, Kenya, July 6 – COVID-19 related payments for insurance business have declined by Sh171mn in six months highlighting the reduction of the disease which came as a shock for underwriters and disrupted the health sector.
According to data released by the Insurance Regulatory Authority(IRA) , a total of Sh8 million was paid in March compared to Sh180million paid in October 2021, representing a 96 percent decline.
This is a decline from the more than Sh 1.3 billion paid by medical insurers companies to cover COVID-19-related illnesses for the period between March 2020 and June 2021.
A report released by the Association of Kenya Insurers(AKI) reveals that at the time, the figure accounted for 74 pc of the total claims lodged with medical insurers which stood at Shs 1.7billion.
Titus Osero, IRA’s Senior Manager, Actuarial and Data Analytics, during a media workshop, said that while the COVID-19 outbreak came as a shock for many underwriters, it challenged many of them to review their clauses in readiness for similar uncertainties.
“Taking into account the decline of cases and measures put in place to reduce infections, the COVID-19 insurance payments have declined because at the end of the day the number of people admitted to hospital and deaths reduced,” he said.
Only two companies had the pandemic as an exclusion creating uncertainities amongst players who had to pay high medical payments.
“The COVID-19 pandemic came and has strengthened the sector, more underwriters are now careful on how they work on their clauses,” he said. “In the beginning,the pandemic really impacted the insurance sector because there were high medical payments. companies were strained because most of them incurred high costs.”
In response to the pandemic, he said IRA requested companies to re-submit their medical rewards and it further ensured that all COVID-19 pending bills have been sorted.
“Going forward, underwriters are well prepared and while they cannot exclude such uncertainties, many of them have opted to put limitations on the amount of money that can be paid,” he remarked.
As of March 2022, the total amount of COVID-19-related claims stood at Sh140 million, a decline compared to the Sh 1.4 billion reported in October 2021
