Insurance premiums went up by 19 percent in the second quarter of 2021 to hit Ksh144.02 billion compared to Ksh121.04 billion in Q2, 2020 according to the latest data from the Insurance Regulatory Authority (IRA).
General insurance business remained the largest contributor to industry insurance premium contributing 59.3 percent of the total premiums at Kshh85.36 billion while long-term insurance premiums stood at Ksh58.66 billion in the period under review.
According to the data, general insurance business underwriting results reduced significantly from a marginal profit of Ksh62.45 million in Q2 2020 to a loss of Ksh1.46 billion in Q2 2021 attributed to high increase in loss ratios due to relaxation of restrictions that had been imposed on travel due to COVID-19 pandemic.
Claims incurred in the general insurance business amounted to Ksh32.38 billion during the period under review, a 15 percent increase from Ksh28.08 billion reported in the second quarter of the previous year.
“The high premium volume classes of general insurance business contributed the largest proportions of incurred claims; medical (38.7 percent), motor private (29.8 percent) and motor commercial (22.8 percent). Motor classes of insurance business comprised of 52.7 percent of total claims incurred compared to their contribution of 27.8 percent of the total premium under general insurance business,” the report states.
The claims paid increased by 16.9 percent to Ksh30.60 billion compared to Ksh26.17 billion paid in Q2 2020. Medical, motor private and motor commercial had the highest amounts of paid claims at 39.3 percent, 26.9 percent and 21.5 percent respectively of total industry paid claims under general insurance business.
In the period under review, UAP Insurance maintained the market lead under the general insurance market with 8.6 percent market share followed by CIC General Insurance and GA Insurance at 8 percent and 7.7 percent respectively.
On the other hand, companies in the long-term business made Ksh54.57 billion a 22.9 percent increase from Ksh44.4 billion reported by the end of Q2, 2020.
In the long-term business Britam Life Assurance maintained its lead, with 21.3 percent market share followed by ICEA LION Life Assurance at 16.2 percent and Jubilee insurance company with 11.5 percent market share in the period under review.
According to the report, the total net premium income (NPI) reported by long term reinsurance companies in Q2 2021 declined marginally by 0.9 percent to Ksh1.5 billion compared to Ksh1.52 billion reported in Q2 2020, while the general reinsurers reported an increase in the net premium income of 13.4 percent from Ksh10.73 billion reported by the end of Q2 2020 to Ksh12.17 billion in Q2 2021.
The insurance industry asset base grew by 11 percent to Ksh819.65 billion as at the end of Q2, 2021 from Ksh738.72 billion held as at end of Q2 2020. A significant portion of total assets Ksh698.05 billion (85.2%) were held in income-generating investments.
“Investments in income generating assets grew by 12.9 percent from Ksh618.04 billion reported at the end of Q2 2020 to Ksh698.05 billion in Q2 2021. Asset classes with the highest proportions of above 5 percent were; government securities (67.4 percent), investment property (12.4 percent) and term deposits (8.3 percent),” the report concluded.