Last year, Kenya’s long-term, or life, insurance premiums increased by 23.1 percent to Shs235.39 billion, while general insurance, which includes motor and medical cover, grew by 11.4 percent to Shs227.17 billion. That momentum has continued into 2026, with the Insurance Regulatory Authority reporting a sharp rise in the first quarter, led by a 36.3 percent increase in long-term gross premium income to Shs72.87 billion.
These figures tell the story of a sector that is expanding rapidly, but if you look beyond the value of premiums, a very different picture emerges. Insurance penetration fell from 2.44 percent of GDP in 2024 to 2.2 percent in 2025, well below the African average of about 3.5 percent and the global average of 7.4 percent. That gap becomes even more striking when you look at health insurance. Medical is now the largest class of general insurance, accounting for more than 40 percent of premiums, yet private health insurance reaches barely 4 percent of Kenyans.
This situation creates the ‘coverage illusion’, where the industry appears to be growing when measured in shillings, but not when measured by the number of people who are actually protected. We are growing in shillings while shrinking in reach, “premium without penetration, product without trust”. Affordability is certainly part of the problem, but the bigger challenge may be trust deficit, whether people believe insurance is worth paying for in the first place.
Research by the Association of Kenya Insurers (AKI) points to a limited understanding of what insurance covers and uncertainty over whether claims will actually be paid. Recent difficulties involving Trident Insurance, KUSCCO Mutual and Corporate Insurance placement under statutory management serve to reinforce these concerns, leaving customers with legitimate questions about whether the policies they pay for will deliver protection when they need it most. But trust is not shaped only by what happens when a claim is made. It is also shaped by whether the product itself feels relevant, affordable and suited to the realities of the people it is intended to protect.
Indeed, many of the products available in Kenya today are based on models developed for other markets, with assumptions that may not always fit the local context. And when insurers have to work within treaties and models developed elsewhere, they can have less room to create flexible products that respond to local needs.
That mismatch becomes even harder to address as the cost of service continues to rise. Aon, Mercer and WTW, for example, place the global medical inflation trend at 9.8 percent, the first projection below 10 percent since 2023. The Middle East and Africa, remain the highest-cost regions, with medical costs rising by between 11 percent and 15.3 percent, while Kenya is near 13.5 percent.
The local data is stark, medical claims have almost doubled in five years, rising 97 percent to KES 52.6 billion, driven by utilisation, comorbidities, lifestyle-related conditions and fraud. In 2025, Medical claims rose 17.9 percent and now absorb 51.2 percent of every shilling paid out of the general insurance claims, taking them above the halfway mark for the first time in a decade. Insurers have repriced hard, for instance medical premiums are up 81% to KES 93.2 billion yet the loss ratio sits at 77.7% on a conservative look, forcing underwriting losses, exits and tighter terms .In other words, the cost of doing the insurance business has continued to outpace even significant increases in premiums.
Meanwhile, the widening gap between what customers pay and what their cover ultimately provides makes the question of value increasingly important and puts greater pressure on the broker to demonstrate value addition. The broker’s mandate which seems abandoned is to provide that advocacy by understanding the client’s needs and helping negotiate the right cover in addition to standing with them when a claim arises. Over time, however, that role seems to have shrunk down to placement, just as insurance distribution. This can easily be interpreted to the space having been commoditised. Recently, telcos, banks and bancassurance channels have been licensed to distribute insurance and are estimated to account for about a tenth of premiums.
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In such a space, the only ground left is advocacy, expertise,collaboration and outcomes that is owning turnaround from placement to claim, making wellness and prevention the bedrock, and feeding client feedback into design for genuine need and ultimate cover hyperpersonalisation.The true value goes back to traditional responsibility of representing the client throughout the life of the policy. Prevention must finally pay through innovative reward models that align reward for the claim that never happens. This is the strongest lever to re-orient and fix the current trend. Aon maps from its recent publication that technology will reshape employee benefits within five years. The current buzzword is AI adoption. Realistically AI arrives in two waves that the mundane/back office automation i.e. pre-authorization, real-time claims adjudication and payment, assessments and auto linkages to garages in a matter of minutes not days, then the complex bit which is infinite but as an example predictive risk, flexible informed pricing and personalized underwriting, chronic-care navigation etc. The survivors are those that will intentionally use AI to say yes faster and keep members satisfied, not to deny faster. The next client demands it, demographics have shifted and the current client buys transparent, embedded bite-sized cover from brands they trust and abandons any that treat a claim as a fight.
The answer to a squeezed market is not sharper undercutting but a deeper solution, an end-to-end employee-benefits stack spanning from payroll, insurance, pension, statutory advisory all with administration outsourcing bouquet as the connective tissue that unlocks growth and frees HR to focus on development of people and culture. Regulators can accelerate it with global practice as the benchmark that is consumer-outcome regulation, published claims and turnaround benchmarks, curb on undercutting, prevention incentives promotion, innovation sandboxes, data portability and professionalised intermediation. AKI’s 2026 Customer Service Charter i.e. expectation of a claim to be acknowledged within 24 hours, a dedicated handler, published performance etc. is exactly that floor; applied market-wide it would rebuild trust faster than any product launch.
The new dawn is not a product or a platform but the redefinition of a mandate: from placing risk to advocacy. Penetration below the African average is no verdict on demand, the demand sits in the 96% private health cover never reaches. Closing that gap is the sector’s largest opportunity, and it belongs to whoever remembers the broker’s oldest job: to stand on the member’s side.
(The writer is the General Manager Healthcare Division at Minet Kenya Insurance Brokers Ltd)
