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Kenyan insurers will face greater scrutiny as regulators protect investors

  • Market Insight 22 December 2020 22 December 2020
  • Global

  • Insurance 2021 - the year ahead

As regulators worry about the impact of Covid-19 on re/insurers’ finances across Africa, so we can expect that the frequency of financial reporting may change.

In Kenya, current regulations require re/insurers to submit annual and quarterly financial reports to the insurance regulator. However, we foresee a situation where the reporting timeframe may need to be shortened while re/insures take stock of the negative effects of the Covid-19 pandemic on exposures, income and reserves.

As the situation continues to evolve, the primary concern of the regulator must be to ensure investor protection and to maintain the integrity of the insurance sector. Most significantly, the potential contraction of the reporting timetable may be accompanied by additional reporting requirements.

We also predict a situation where the regulator may play a greater role in the development of policies that would guide underwriting in a Covid-19 climate. The regulator is likely to assess the risks and potential claims that may arise, and from time to time may issue guidelines on the compensation of claims arising from the pandemic. In doing so, there is a need for the regulator to be cognisant of the potential challenges from insureds that may arise by virtue of new guidelines.  The regulator will need to exercise judgement in this regard as has been seen in other jurisdictions such as UK and Australia.

View all our Insurance 2021 predictions here

 

 

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