Insurance premiums rise 13.2 per cent in second quarter of year

Insurance Regulatory Authority attributed the growth to the ongoing economic recovery from the effects of the Covid-19 pandemic. [Istockphoto]

Insurance industry gross premiums rose by 13.2 per cent in the second quarter of 2022 to hit Sh163.06 billion, data from The Insurance Regulatory Authority (IRA) shows.

The premiums stood at Sh144.02 billion in a similar period in 2021. IRA attributed the growth to the ongoing economic recovery from the effects of the Covid-19 pandemic.

The general insurance business remained the largest contributor to the industry insurance premiums, contributing 56.7 per cent of the total premium. Motor insurance and medical insurance classes of business accounted for 62.5 per cent of the gross premium income under the general insurance business, IRA said.

In the quarter under review, general insurance premiums increased by 8.2 per cent to Sh92.4 billion compared to Sh85.36 billion recorded in the second quarter of 2021. Medical and motor insurance classes maintained a leading position in terms of contribution to general insurance business premiums at 34.5 per cent and 28.1 per cent respectively. Workmen's compensation and miscellaneous classes were the only classes whose premiums decreased by 10.4 per cent and 7.9 per cent respectively.

"The general insurance business underwriters incurred claims amounting to Sh37.09 billion as at end of quarter 2, 2022. The claims incurred loss ratio was 68.1 per cent in the quarter under review compared to 66.8 per cent in the second quarter of 2021," the IRA report indicated.

Motor classes of insurance business incurred claims contributed 48.3 per cent of total claims incurred compared to their business contribution of 28.1 per cent of the total premium under general insurance business.

The claims paid increased by 12.7 per cent to Sh34.51 billion. Medical, motor private and motor commercial had the highest amounts of paid claims at 44.4 per cent, 25.2 per cent and 20.7 per cent respectively of total industry paid claims under the general insurance business.