Challenges facing insurance brokers in Kenya
It’s not good and not bad. The current average insurance penetration level in Kenya is at three per cent of the GDP compared to South Africa at 12 per cent. In the East Africa region, we are followed by Tanzania and Uganda at less than one per cent. There is a drive to sell insurance to millennial from this year, why now? Research carried out both by Insurance Regulatory Authority (IRA) and other global bodies has proved that the millennials will be the greatest consumers and that’s why we are targeting them. Historically, many of the insurance products sold then targeted the old. Millennials are also able to spend without a blink and are able to appreciate the products much more. The micro- insurance is some of our target areas, where we use mobile phones to reach them.
SEE ALSO :Kenya Re gets favourable credit ratingWith help if IRA, we have embarked on activities aimed at education awareness and protection of consumers by brokers. We are engaging with our intermediaries on understanding of policies. We are also training our staff to make sure that the claimant understands the policies to bring about better understanding of insurance policies. We hire facilitators to train staff on how to articulate the policies and public relations. In 2016 it was near Sh400 billion, in 2017 the report is not yet out and we project it could be reach Sh500 billion this year What about the negative public perception about insurance brokers? Indeed, there has been that negative perception about that term brokers and it has been a historical problem. We blame it on how insurance was introduced in Kenya, making it a foreign business and hence lack of understanding. The language used was also hard to understand and the general feeling was that insurance was making money by disappointing their clients. However, over time, a lot has been done including standardising insurance language. Terms like indemnity and the process of claiming have been simplified. Today’s insurance agents are also well trained and can advise one well thus changing perception. There has been an outcry by insurance brokers that they do more work yet get low commissions. Your comment? Currently, we are paid 10 per cent of the premium for motor and 25 per cent for fire which is not adequate. We are in discussions with IRA to change from being paid by regulated commission rate to fees because we feel what are doing is much more to be paid by commission. You find that sometimes a broker may spend a long time advising a client and he or she may not buy the insurance immediately. We offer professional service and follow up your claims. [email protected]