A resent research on the motor vehicle insurance sector showed that up to a fifth of motor vehicle insurance policies cannot be verified as genuine, while 12 per cent of the insurance covers that motorists claim to have are simply non-existent when checked in the underwriter’s books. Kenindia Assurance, Chief Manager Claims Mr. Kennedy Misati talks about the different intricacies of the motor insurance industry in Kenya.
The Q4 industry report by Insurance Regulatory Authority showed that general insurance business grew by 3.5 per cent mostly driven by compulsory motor insurance. What do you think will take this percentage higher?
The compulsory requirement by government to purchase motor insurance may not necessarily create a growth. I believe that the below factors will affect the growth in the future
- Easy access to credit by consumers making it easier for them to purchase insurance
- A highly educated population under 40 who understand importance of insurance
- A growing middle class that continues to invest in motor vehicles and the finer things in life
- Rural urban migration that increases the number of buses and shuttles on our road
In the recent occurrence at Malik Plaza where cars were burnt due to a fire, what advice would you have for tenants whose motor vehicles may be parked at their offices or homes and such an incidence happens?
For owners of car yards, our advice is to consider the purchase of a fire or industrial all risks policy that covers all likely scenarios. In the case of the Malik Plaza, the vehicles that were damaged by fire were for sale and therefore they are insurable as stock in trade a policy other than motor.
A recent survey showed that 40 percent of car insurance policies in Nairobi alone could be fake. How can motorists validate the authenticity of their cover?
We advise motorists to demand for the official premium payment receipts from the underwriter said to have issued the cover and go an extra mile of contacting the insurance company for confirmation of type of cover granted.
Smart cars with advanced technologies are slowly being seen in Kenya. What would be the implications on motor insurance and repairs of these cars?
Just as in any new models introduced to this country, in the event of accidental damages, spares are not readily available and these have to be imported causing huge delays on turn- around time on repairs. IRA have given guidelines how this claims will be handled. Company’s liability is limited to cost of repairs and cash in lieu of repairs may be given.
Is the perception that most Kenyans have taken up third party insurance true? If so, why is this the case and what would be the merits and demerits of this?
As an insurer, we provide three types of cover the client may choose: comprehensive, third party fire and theft and third party only. We have seen that thee factors that may lead the client to go for third party only which attracts the lowest premium are the age of vehicle and ability to raise the premium. While it is third party is the cheaper option, one must keep in mind that the comprehensive affords a wider cover and equitable consideration (premium) is higher than the other two forms of cover.
There has been an increase in accidents associated with motorcycles – boda boda – in the western region of Kenya which affects the motor and health insurance. What is your take on this and how can these figures be reduced?
As an insurer, this is an area of concern. We are looking forward to the policies that the government was formulating to regulate this sector.
What are the unique selling points for the motor insurance cover offered by Kenindia?
As one of Kenya’s oldest insurer, we pride in being able to offer our customers:
- Most competitive rates in the market
- Convenience of paying premium through MPESA
- Prompt settlement of motor insurance claims
- Extension of covers such as AA road rescue, Loss of use, PVT, Excess protection etc
- Enhanced limits such as windscreen, radio cassette, towing charges with no additional premium