Insurers are not only battling reluctance to buy insurance among those who have had a bad experience but also among those who have never even tried the concept, warned a group of Kenyan insurance leaders.
Speaking at a roundtable hosted by Equisoft, on the eve of the 48th General Assembly of the African Insurance Organisation, the leading Kenyan market players admitted that growing the insurance market is not easy.
Parul Khimasia, chief development officer at APA Insurance, believes the problem is heightened among those who live outside the cities because there is still an ignorance about the benefits of insurance.
However, Meshack Miyogo, managing director at CIC Life Assurance, fears it goes one step further.
“There is a real problem with misconception about insurance,” he said. “You will have someone tell you that they are adamant that they could never buy a policy, because they can’t trust insurers. When you question them further, you discover they have never bought a policy and are relying on third hand information and actually do not know anything about insurance themselves.
“That is a real challenge for insurers because it requires individual conversations to break down these misconceptions. Once you have those conversations, then people will often say they would buy insurance, but it needs to happen person by person.”
Shingie Maramba, director, wealth and insurance solutions EMEA at Equisoft, warned that insurers must not underestimate the power of what he called the “Braai culture”. He explained: “At a South African braai (or barbeque), people will talk, particularly if something has gone wrong. They will share the bad news with friends of family when a claim has been rejected, or delayed. That all builds an image for everyone at the Braai that insurance is not to be trusted,” he said.
Vijay Srivastava, group CEO at GA Insurance, added: “There is also a lack of awareness about insurance and how it works. They do not see insurance as risk management but as a cost to them.”
The group agreed that technology has a role to play in smoothing the process and enabling a faster turnaround in claims payments, which would help build greater trust in the sector. However, there are some things beyond their control.
As Mr Srivastava said: “As insurers we get blamed when a vehicle goes in for repairs and those repairs aren’t done satisfactorily. We get blamed because it was an insurance claim but actually it was a problem at the garage.”
The group also agreed that insurance agents have a huge role to play across Kenya because they are meeting with potential insureds directly. Laurence Koyaroh, marketing and distribution director at Renshield Insurance Agency, supported that view.
But he called for a vetting system of some kind to root out fraud and “bad actors”. Too often, he said, a rogue agent can submit a claim to one insurer and even if it is rejected, they will simply represent the claim at the next insurer on their list, until someone pays.
He suggested that the insurance industry should work more closely together to identify and root out these people who give the whole industry a bad name.
Rose Wanda, secretary general at the Organisation of Eastern and Southern Africa Insurers, agreed, suggesting it was time insurers started to work together to help improve the perception of insurance.
“If you look at the reinsurance market, they work more closely together for the good of the whole and perhaps it is time the insurers did the same,” she said.
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