Home - World News - Kenya - Insurance industry records a 16% profit rise

Insurance industry records a 16% profit rise

The insurance industry in Kenya recorded a growth net profit by 16.8 per cent to Sh11.1 billion in the year ended December. This is according to statistics from the Insurance Regulatory Authority (IRA).

The net earnings in the sector stood at Sh9.5 billion the previous year. The performance excludes results from operations outside Kenya and also leaves out reinsurers.

Some insurers including Liberty Kenya Holdings and CIC Insurance Group have reported their consolidated full-year earnings, with each firm’s respective performance influenced by its unique circumstances.

The sector’s gross premiums rose 12.3 per cent to Sh194.7 billion, with claims or benefits jumping 17.1 per cent to Sh90.6 billion.

Commission expenses grew 11.3 per cent to Sh12.3 billion while administrative costs increased 6.7 per cent to Sh38.1 billion.

Shareholder funds in the industry expanded 9.8 per cent to Sh112.2 billion.

Insurers have been retaining the bulk of their profits to comply with new regulations requiring higher capital levels.

Life insurance, which has become more competitive in recent years, was the most lucrative for the industry. The net profit in this segment more than tripled to Sh5.8 billion in the review period.

Life insurers’ gross premiums rose 19.2 per cent to Sh73 billion while benefits paid to policyholders jumped 30.8 per cent to Sh36.9 billion.

Commissions in the long term business grew 10.2 per cent to Sh5.5 billion while administrative expenses increased 7.4 per cent to Sh12 billion.

The general insurance business recorded a 31.3 percent net profit drop to Sh5.2 billion, underlining the impact of higher claims.

Players in this segment recorded an underwriting loss of Sh390.8 million, widening the previous year’s loss of Sh69.9 million in what left them to rely on investments to book the Sh5.2 billion net profit. Motor vehicle and medical covers are the leading sources of claims for general insurers.

Leave a comment

Comments

Powered by

...read more on post

 

Check Also

Here are the Most Marketable Courses in Kenya

Unemployment in Kenya has reached a staggering 40 per cent. There is, however, some good …