Insurer starts IT arm to step up its regional presence

UAP Holdings — the parent company that owns UAP Insurance — is investing Sh400 million in IT as it plans to expand into asset management and property development.

It is forming a subsidiary that will offer information technology support for the group, signalling the growing use of IT in the underwriting industry.

UAP Global Services will support the group’s financial services and property management investments in Kenya, Uganda, South Sudan and Rwanda. (Read: UAP to buy Rwandese insurer by December)

“The new subsidiary will handle online and mobile-telephone enabled sales of our products among other support services,” said Mr James Muguiyi, the UAP Group managing director.

Competitors like British American Insurance, Insurance Company of East Africa, CFC Insurance and Pan Africa Holdings have also expanded their portfolio. Like Pan Africa Life owns a property development and management company Mae Properties, UAP also eyes property development and management.

The insurer will use the new business arm to enter the Real Estate Investment Trusts or trading at the stock market.

The company commissioned a residential property in South Sudan on Monday.

The Equatoria Tower, which is 12-storeys, will be the tallest building in South Sudan. The company is also constructing a 32-storey office block in Kenya.

UAP Global Services will handle research, product development and distribution through IT-enabled channels.

The step is the departure from the lukewarm reception the insurance is said to have given IT.

UAP has launched ‘Salamasure’, a product that allows registration, payment and reporting of claims on phone. “The use of the mobile phone platform to sell insurance will definitely change the industry’s landscape in Kenya because a huge number of Kenyans can conveniently and cheaply take up the cover,” said UAP Insurance MD James Wambugu.

In the recent past, the insurance industry has been marked by intense competition, forcing players to upgrade their systems and come up with a wider book of products to remain afloat.

UAP Insurance had a market share of 7.38 per cent in 2010, behind the leader Jubilee at nine per cent and APA at second position with 8.81 per cent, according to Association of Kenya Insurers (AKI).

The company plans to list at the Nairobi bourse before the end of the year.

smbogo@ke.nationmedia.com