The Kenya Listed Insurance FY’2022 report, just released by Cytonn Investments, highlighted that the insurance industry continues to demonstrate resilience, with a 12.2% increase in gross premium to Kshs 309.8 billion in FY’2022, up from Kshs 276.1 billion in FY’2021. The report analyzed the five listed insurance companies: Jubilee Holdings, CIC Insurance Group, Liberty Kenya Holdings, Sanlam Kenya Plc, and Britam Holding Plc.
According to the report, the listed insurance companies’ average core earnings per share significantly rose, growing at a rate of 377.4% in FY 2022 as opposed to 89.2% in FY 2021.
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“The sustained growth in earnings was attributable to increased premiums during the period following continued recovery by the sector from the impacts of the COVID-19 pandemic, coupled with higher yields from government papers,” said Cytonn.
However, insurance penetration remains quite low, with a 2.2% insurance penetration rate for FY 2022. The rate is lower than the global average of 7.0% and 3.2% in Africa.
“The low penetration rate is attributable to the fact that insurance uptake is still seen as a luxury and is mostly taken when it is necessary or a regulatory requirement,” Cytonn added.
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Most insurance providers continue using the available digital channels to promote growth and broaden the country’s insurance coverage. The country’s strong mobile penetration gives distributors more room and chances to reach younger consumers and those not reached by more conventional distribution channels with insurance goods.
“We anticipate sustained moderate growth on the back of an improving economy and subsequent rise in insurance premiums, which will strengthen the sector’s ability to sustain profitability,” said Cytonn.
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