Unpaid claims land insurer class action court battle

Industry’s profit

The entire industry’s profit before taxation in 2008 was Sh1.6 billion compared to pre-tax profit of the Kenya Commercial Bank for the first nine months of 2009 of Sh4.9 billion.

The surge in unpaid claims also undermines the positive outlook for the industry that the sector’s lobby has been pitching since the year began.

“We see 2010 as the beginning of a defining decade in terms of the development and strengthening of the insurance industry,” said Association of Kenya Insurers chairman Nelson Kuria.

High risk and delays in settlement of claims that Kenyans associate with the insurance industry has been blamed for the slow uptake of policies in the country.

IRA said it has started scrutinising insurance companies for their ability to pay claims -- a move that represents a big win for consumers frustrated by delayed payments.

Last week, the authority formed two supervision teams with the mandate of ensuring that insurers keep up to speed with claims settlement.