Over 40 percent of Kenyans have a bank account, and when one includes the use of mobile money over 80 percent enjoy access to formal financial services. Yet the penetration of insurance in Kenya stands at under 3 percent – and it is not rising. Understandably, many commentators therefore see huge potential for developing this arm of the financial sector, typically quoting South Africa’s penetration rate of 17 percent as a comparison and lamenting the unimaginative use of technology by Kenyan companies.
So why is our penetration so low, and what might be done to increase it? For sure many feel that insurance is “just for the well-off”, “a Nairobi thing”. Others feel the odds of needing to claim on a policy are too low to justify paying the premiums required – defying the whole basis of insurance, which is to collect from the many so as to be able to compensate the few who have legitimate claims to lodge.
