How Kenyan insurers will benefit from new marine policy

Cargo at the Mombasa Port. Importers are expected to secure maritime insurance policy starting February 14, 2025. [File, Standard] Kenyan Insurance companies are eyeing profits once a new policy requiring importers to secure maritime insurance policy locally kicks in. According to data from the World Bank, the global market for Marine Insurance was estimated at $29.6 Billion in 2023 and is projected to reach $33.7 Billion by 2030. Kenya Revenue Authority (KRA) in a joint notice with the Insurance Regulatory Authority (IRA), in January, informed importers that this rule will be enforced starting February 14, 2025. Though expected to severely affect foreign insurers' involvement in marine insurance for goods entering Kenya, it's an opportunity for local insurers to extend a grip in the maritime sector. Marine insurance policy protects goods from the risk of loss, damage, and theft during transit by sea, land, and air from the port of origin. The cover protects importers from loss, giving financiers the comfort to lend to such businesses ordering the goods. Following the Enactment of the Finance Act, 2017, on June 23, 2017, the amendments to The Marine Insurance Act CAP 390, Section 16A made it mandatory for any person with Insurable Interest in marine cargo to place Marine Cargo Insurance with an insurer locally licensed under the Insurance Act. Further, amendments to the Insurance Act CAP 487 section 20(4), through the Statute Law (Miscellaneous) Amendments Act 2017, outlawed sourcing of marine cargo insurance policies from insurers not locally licensed under the Insurance Act. The state has now moved to ensure compliance. "All importers shall be required to digitally procure Marine Cargo Insurance cover for their imports from locally licensed insurance companies," reads part of the joint statement. The Digital Marine Cargo Insurance Certificate request will be submitted through the clearing agents' and importers' mobile Apps, dedicated portals, or Insurance Underwriters Platforms connected to the Insurance Regulatory Authority (IRA) electronic platform. The processed digital marine certificate from the IRA Platform will be electronically submitted to the KRA Integrated Customs Management Systems (ICMS). The growth in the marine insurance market is driven by several factors, including the increasing volume of global trade, rising investments in offshore energy exploration, and the growing demand for risk mitigation in high-value cargo transport. The expansion of international shipping routes, particularly in emerging markets, has resulted in a greater need for comprehensive marine coverage to protect against cargo loss, damage, and liability. Additionally, regulatory requirements and environmental concerns are pushing shipping companies to secure coverage for pollution and other maritime liabilities. Technological advancements, such as the integration of blockchain and IoT, are improving efficiency and transparency, further driving adoption in the marine insurance market. Marine insurance is an essential component of global trade, providing protection against the wide array of risks associated with maritime transport, including damage or loss of ships, cargo, and other marine assets. As the global economy relies heavily on maritime logistics to transport goods across continents, the risks posed by piracy, natural disasters, cargo damage, and accidents at sea necessitate comprehensive marine insurance policies. Marine insurance policies cover a wide range of potential liabilities, ensuring that ship owners, cargo owners, and traders can mitigate financial risks arising from unforeseen incidents. With growing maritime trade routes and the expansion of offshore energy projects, the importance of comprehensive marine insurance continues to rise in both established and emerging markets. Coverage types include hull insurance, cargo insurance, and liability insurance.

How Kenyan insurers will benefit from new marine policy

Get Full Access for Ksh299/Week.

Related Topics

Similar Articles

Latest Stories

The Standard Insider

Digger Classified

GET OUR NEWSLETTER

CONNECT WITH US

FOR THE LATEST JOB ADVERTS

Similar Articles

Fintech leaders, regulators meet as stablecoins gain ground

Private developers eye deeper presence in Coast region

CS Kabogo: Digital economy now established, focus shifts to governance and accountability

How Ruto's aggression over fuel prices with EAC neighbours strains ties

DIGGER JOBS

Digger Motors

Digger Real Estate

How Kenyan insurers will benefit from new marine policy

Get Full Access for Ksh299/Week.

Related Topics

Similar Articles

Latest Stories

The Standard Insider

Digger Classified

GET OUR NEWSLETTER

CONNECT WITH US

FOR THE LATEST JOB ADVERTS