According to a report by the Insurance Regulatory Authority (IRA), there were 61 fraud cases in Kenya’s insurance sector overall in the first quarter of this year.
The types of fraud cases that were reported throughout the time frame included theft, fake motor vehicle insurance certificates being issued, false claims of motor vehicle accidents, collecting money under false pretenses, and complaints against agents.
The most common irregularities seen during January, February, and March of this year included fake death claims, employee theft, non-compliance with the insurance laws, and fraudulent medical insurance claims.
In Q1 2023, the Insurance Regulatory Authority (IRA) received 522 complaints. 20.9 percent of the complaints were made against long-term insurers, while 79.1 percent of complaints involved general insurance activity.
“Over the period under review 125 (30.3 per cent) complaints against General insurers were resolved while 53 (48.6 per cent) complaints against long-term insurers were resolved,” IRA said.
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General insurance premiums totaled Ksh62.52 billion throughout the review period. As of the end of the first quarter of 2023, the general insurance business underwriters had claims totaling Ksh21.53 billion.
In comparison to Q1 2022, the claims incurred loss ratio was 72.0% in the quarter under review. When compared to the loss of Ksh510.20 million reported in the first quarter of 2022, the general insurance company analysts reported an overall loss of Ksh2.01 billion.
In comparison to the Sh418.81 million reported in Q1 2022, the total net premium income (NPI) reported by long term reinsurance companies in Q1 2023 was Sh902.43 million, an increase of 115.5%. 96.3 percent of the total NPI calculated over the reviewed period was contributed by Group Life.
The net premium income for the general re-insurers decreased by 23.3% from Sh8.96 billion at the end of Q1 2022 to Ksh6.88 billion in Q1 2023. The general re-insurers paid out Ksh3.85 billion in claims and Ksh2.90 billion in direct costs (commissions and administrative costs).
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At the end of the first quarter of 2023, the net results were an underwriting profit of Sh487.88 million and an operational profit of Ksh1.44 billion.
