Kenya aiming for inclusive and competitive insurance market by 2030
Friday, April 29, 2016
In global terms, African citizens remain the most vulnerable people with the least access to insurance. To change this situation in its country, the government of Kenya is aiming at a more inclusive and competitive financial services sector, in which microinsurance is to play a key role, by 2030. Ideas that challenge conventional insurance approaches seem to be the road to growth. The question of how these ideas can result in viable business models was discussed during the 2016 Microinsurance Learning Sessions in Kenya, held earlier this month.
Focus on customer value and sustainability
The conference took place at the right time in the region in which the market is expanding. Significant milestones have been achieved. However, half of the products that were introduced in the past were withdrawn within one to two years, according to the Commissioner of Insurance. The main reason for this is that apparently the products were not sustainable.
Drivers for market development
Despite the growing importance of technology in particular and of distribution through mobile network operators (MNOs), the majority of the participants agreed that insurers will remain more important as drivers of market development than the distribution channels. A strong majority at the event was of the opinion that MNOs will still not be the main distributors for insurance in Kenya in five years. Representatives from the insurance industry raised concerns about a possible attempt by the MNOs to monopolise distribution channels. In terms of customer value, the participants agreed that the insurers and distribution channels play an equally important role in ensuring value for the client as regulators or donor organisations.
The above is extracted from the conference report. The full report can be read here.
Source: Microinsurance Network
Written by Dirk Reinhard, Vice Chairman, Munich Re Foundation, Germany and Lemmy Manje, Consultant, Zambia