According to a recent report release by the Insurance Regulatory Authority (IRA) three insurance Companies were responsible for over a third of all consumer complaints lodged against the insurance sector in the first quarter of this year.
Monarch Insurance, Trident Insurance and Corporate Insurance accounted for a significant 35.6 per cent of the total complaints received by the industry watchdog. Out of the 522 complaints reported to the IRA by policyholders and insurance beneficiaries, 83 were directed at Monarch Insurance’s general business.
Corporate Insurance faced 63 complaints, with 36 related to its long-term insurance business and 27 targeting its general insurance. Meanwhile, Trident received 40 complaints regarding its general insurance business.
The IRA stated, “The Authority registered 522 complaints in the first quarter of 2023. General insurance business accounted for 79.1 per cent of the complaints, whereas 20.9 per cent were made against long-term insurers.” The IRA’s main responsibility is to safeguard the interests of insurance policyholders and beneficiaries in insurance contracts.
During the review period, 125 (30.3 per cent) complaints against general insurers were resolved, while 53 (48.6 per cent) complaints against long-term insurers were resolved.
Compared to the first three months of 2022, the number of complaints against insurers increased in the current quarter.
The IRA report also revealed positive growth in the industry’s assets, which increased by 14.1 per cent, reaching Sh1 trillion, with industry liabilities amounting to Sh815.50 billion, resulting in a net asset value of Sh184.97 billion.
The sector’s gross premium income experienced a notable growth of 14.8 per cent in the first quarter of this year, rising to Sh104.5 billion compared to Sh88.4 billion in the same quarter of the previous year. The report attributed this growth to the ongoing economic recovery from the negative impacts of Covid-19 in 2020 and 2021. This income has shown consistent growth over the past three years, starting from a five-year low of Sh79.3 billion in the first quarter of 2021.
Long-term insurance business premiums accounted for Sh38.97 billion, representing 38.4 per cent of the total industry premium, while general business premiums amounted to Sh62.52 billion (61.6 per cent). This is an improvement compared to Sh34.5 billion registered in a similar period last year, which represented 18.6 per cent of sector premiums.
Investment income under the long-term insurance business increased to Sh14.38 billion during the review quarter compared to Sh9 billion in the previous year. The general insurance business recorded an investment income of Sh2.98 billion during the same period, showing growth from Sh2.5 billion in the previous year.
Under the general insurance business, the highest growth in gross premium income was observed in the workmen’s compensation category, which saw an increase of 64.1 per cent, rising from Sh3.19 billion reported in the first quarter of 2022 to Sh5.23 billion in the current year. On the other hand, personal accident insurance experienced the largest decline, dropping from Sh1.07 billion in 2022 to Sh972.67 million in the current quarter.
The main contributors to incurred claims in the general insurance business were medical claims at Sh8.72 billion (40.5 per cent), followed by motor commercial claims at Sh5.29 billion (24.6 per cent), and motor private claims at Sh4.99 billion (23.2 per cent). Medical, motor private, and motor commercial claims remained dominant, accounting for 40.9 per cent, 24.9 per cent, and 23.1 per cent, respectively, of the total industry-paid claims under the general insurance business.
The underwriting performance of the general insurance business reported a loss of Sh2.01 billion, representing a decline of 294.7 per cent from the loss of Sh510.20 million reported in the same quarter of the previous year. However, the general reinsurers’ underwriting performance recorded a profit of Sh487.8 million, an improvement from the loss of Sh517.18 million in the corresponding quarter of the previous year.