Browsing: Bima Intermediaries Association of Kenya (BIAK)

Insurance brokers in Kenya, as well as insurance agencies, can negotiate terms requiring insurance coverage under credit terms, as happens in the banking industry. The article seems to go all out to malign the insurance agents’ names by saying they are the ones owing the billions.

This gives the impression there could be a hidden motive in the penning of the article. The Kenyan insurance sector is highly regulated, and a working regulator should ensure that such cases are unheard of with licensed insurance agents in Kenya.

According to the Insurance Act Cap 487 Section 156 talks about insurance premiums and the manner in which they are supposed to be remitted to the insurer. Insurance brokers in Kenya are supposed to remit their premiums immediately after they receive the same from the client. Other intermediaries have a certain window within which they are supposed to remit the premiums and this …

According to Wiktionary, to claw back is to recover or retake with great effort something that was lost.  

In the insurance industry the words “claw back” are used in relation to insurance commissions that are deemed payable to insurance agents or brokers. The implication of these two words is that commissions paid up to the intermediary are forcibly taken away from them at a future time from other commissions payable for business delivered. The biggest question from this practice is: how legal is this? 

The Eleventh Schedule of the Insurance Act Cap 487 of the Laws of Kenya spells out maximum brokerage, commission or other procuration fees payable after a business is introduced into the insurance company by an intermediary. It is worthy to note that a commission is payable after the company is satisfied that the business so brought has met all the underwriting guidelines and has therefore been …

Kenya’s insurance sector has been rocked with controversies among them failure to meet contract obligations, exposing policy holders to risks rather than being cushioned as expected of indemnity.

In the latest twist of events, it has emerged that over ten insurance companies in Kenya are not paying claims, despite collecting billions in monthly premiums from their clients.

This has left hundreds of thousands exposed to risk while affected persons suffer despite having insurance covers.

There are 37 general insurance companies and 25 long term insurance companies, placing the total number of underwriters at 62.

The country’s insurance market has also been infiltrated by banks, which are offering insurance services under the ‘Bancassurance’ umbrella.

READ:What’s next for the insurance industry in Kenya?

Billions in premiums

According to official data by the industry regulator-Insurance Regulatory Authority (IRA), insurance industry gross premium written stood at Ksh216.37 billion (US$2.12billion) as at end of …