Medical Insurers Fork Out Ksh1.3 Billion For COVID-19 Treatment

Medical Insurance Companies paid a total of Ksh1.3 billion to cover treatment of COVID-19 for the period March 2020 to June 2021, data collected by the Association of Kenya Insurers (AKI) has shown.

This figure represents 74 percent of the total claims lodged with medical insurers which stood at Ksh1.7 billion.

Following the onset of COVID-19 in March 2020, it emerged that there was mixed practice when it came to coverage of pandemics. Some insurers excluded it in their policies while some had no mention of it.

Medical insurers have since been clear in their policies to state whether it is an inclusion or exclusion and, if included the cover limit is specified. Considering this, not all claims that were lodged during the period March 2020 to June 2021 were paid and this could be attributed to the different scope of covers.

The rejected claims, during the stated period, stood at Ksh396 million, representing 23.3 percent of the total claims. The remaining three percent, Ksh37 million is outstanding, due to various policy conditions or terms.

A total of 15,522 claims were lodged during the period. Out of these 3,934 were inpatient claims while 11,588 were outpatient.

In 2020, the medical insurance business grew by 4.58 percent to record gross written premium of Ksh44 billion compared to Ksh42 billion in 2019. Claims incurred and total expenses also increased by three percent and 11 percent respectively during the same period. Underwriting profit increased from Ksh204 million in 2019 to Ksh1.7 billion in 2020.

While the gross written premium for medical insurance over the years has been on the increase, it has been loss-making. However, in 2019 and 2020, there was growth in profitability, and this could be attributed to better management of expenses and a slight drop in reinsurance ceded. Despite the fear of hospital visitation that was witnessed in 2020, the net claims incurred increased by three percent.

As part of its digitization journey, the AKI Secretariat is exploring the possibility of developing a harmonized data-sharing platform for medical insurers to aid in addressing some of the pressing challenges including fraud and high cost of medical care.

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