Insurance regulator projects rise in disputes on claims

• Number of complaints had reduced from 744 in 2009 to 633 in 2010 and 554 in 2011, but are expected to rise further this year having clocked 492 by end of August 2012.
• Most frequent complaint is delayed or non-settlement of claims where policy holders say the insurer has not paid their claims as expected.
• Rise in the number of complaints is partly a result of the increased public awareness about IRA, and media campaigns about policy holder rights.
• Penetration of insurance products in Kenya remains at 3.1 per cent after growing by 2.5 per cent last year

Complaints from policy holders in the insurance industry are expected to increase this year compared to 2011 largely driven by claims disputes, the Insurance Regulatory Authority (IRA) has said.

The number of complaints, which had reduced from 744 in 2009 to 633 (2010) and 554 in 2011, are expected to rise further this year having clocked 492 by end of August 2012.

However, the rise in the number of complaints is partly a result of the increased public awareness about IRA, and media campaigns about policy holder rights.

The nature of complaints includes delay in payment of maturity benefits, erroneous deduction and over deductions. “We expect this figure to be high than that of 2011,” said IRA in a statement.

“These complaints have created a perception that has led to a credibility crisis affecting the uptake of insurance products and reducing growth of the industry,” said the chief executive officer of the IRA Sammy Makove.

The most frequent complaint is delayed or non-settlement of claims where policy holders say the insurer has not paid their claims as expected.

Mr Makove was speaking in an stakeholder seminar called Liberty Africa Insurance seminar in Nairobi on Friday, organised by both Liberty and CFC Life Insurance to increase literacy levels on insurance products.

Other complaints were delays in payments of maturity benefits, lack of help at the insurer’s branch offices, delays in issuance of stop orders to employers, erroneous deductions of premiums among others.

The penetration of insurance products in Kenya remains at 3.1 per cent after growing by 2.5 per cent last year meaning there is a huge potential for growth in the industry.