NAIROBI, Feb 17 (NNN-KBC) — Kenya’s insurance industry is projected to grow at the fastest pace in sub-Saharan Africa, according to a report by financial services firm Ernst and Young.
The firm says the insurance sector in Kenya will expand by an annualized rate of 6.0 per cent with general insurance driving the growth.
Ernst and Young leader of Actuarial Services Sujay Shah, added, however, that stakeholders needed to tap into technology to drive growth.
Kenya’s growth in premiums is in contrast to the Africa-wide growth of only 4.2 per cent.
Premiums in Nigeria are expected to quadruple in the next five years.
In Ghana, which began producing oil two years ago, the life insurance market is estimated to grow at 40 per cent annually.
In Africa, South Africa leads with the highest insurance premiums per capita, averaging 92,500 Kenyan shillings (about 909 US dollars) while in Kenya it stands at 3,900 shillings.
The firm said Kenyan companies needed to merge in order to make the market more competitive and attractive. There are 49 insurance players in Kenya serving less than 10 per cent of the Kenyan population.
For the last 10 years insurance growth in Kenya had averaged 5.0 per cent per year as the government and the private sector moved to align the industry with emerging trends.
In the recent past, Kenyan insurance companies have been expanding into the East Africa market and diversifying into other areas which is a sign of a thriving sector, said Ernst and Young.