NAIROBI, Kenya, July 14 – The insurance industry must shift focus from over-relying on compulsory products and instead target voluntary classes to boost sector growth and impact, the Insurance Regulatory Authority (IRA) has said.
Speaking at a bancassurance event hosted by Standard Chartered Bank and Prudential Life Assurance Kenya yesterday, IRA CEO Godfrey Kiptum called on stakeholders to embrace innovations that seek to deepen insurance uptake in Kenya.
“Most players only focus on products people are forced to buy—like motor vehicle cover—because it’s easier. But if we focus on protecting livelihoods and offering more value-driven products, we’ll see real growth,” he said.
According to Kiptum, Kenya and the continent still faces low insuramce penetration compared to the rest of the world, a factor that still slows down financial inclusion in Kenya.
Insurance in the country is still largely low.
A study by global market research firm Statista revealed that insurance penetration in Kenya remains low, hovering around 2.3 percent to 2.4 percent of the Gross Domestic Product (GDP), significantly below the global average. This indicates a vast potential for growth within the Kenyan insurance sector.
Overall, it has followed a descending trend since 2016.
Several factors contribute to this low penetration, including a poor saving culture, low disposable income, and a negative perception of insurance among the population.
“Currently, penetration stands at about 2.4%, which is high by African standards but still far below global averages. In Africa, insurance premiums total $63 billion—just about 1% of global GDP. A country like Taiwan, with a population of 23 million, matches the entire continent in penetration levels. That shows the enormous potential for growth.”
kiptum emphasized that low penetration is often linked to broader economic realities.
According to Kiptum, innovative, accessible, and trusted offerings can significantly change the uptake of insurance in Kenya.
