Equity Group has expanded its revenue stream with the launch of its subsidiary Equity Life Assurance Kenya Limited (ELAK).
The license from the Insurance Regulatory Authority (IRA Kenya) will enable ELAK to provide life insurance solutions to an underserved market and contribute towards the vision of Equity Group to transform lives and expand opportunities for wealth creation.
Equity Life Assurance Limited is a fully-fledged business with separate structures and commercial arrangements in line with the IRA regulations.
“We felt the need to make our contribution to the Insurance industry and we believe we can make Insurance be understood better by the ordinary person,” Dr James Mwangi, Group MD & CEO Equity Group said during the presentation of the licence.
“Our inspiration is to offer insurance to all categories of consumers and make insurance accessible, affordable and inclusive in line with our purpose of transforming lives, giving dignity and expanding opportunities for wealth creation. We realised that the greatest threat to wealth creation is when disaster strikes and the family and entities have no fall-back plan except removing capital from their businesses to meet such expenses. The insurance business of ELAK will be based on simplicity, openness, transparency and trust,” he added.
Ms Angela Okinda, the Managing Director and Principal Officer of ELAK said, “ELAK will contribute to the trusted Equity brand by providing inclusive, affordable, innovative and accessible insurance products to a majority of Kenyans who are not utilising insurance solutions to secure much-needed protection of their lives, health and wealth, or secure their financial futures through savings solutions.”
The insurance industry in Kenya is characterized by low penetration levels, currently estimated at 2.4% This has been attributed to a number of factors including poor or limited product portfolio, low or no awareness of available insurance products, low-income levels among the key consuming public, perceived low rate of returns for life insurance policies, cumbersome claim settlement procedures, lack of trust of insurance players, negative perception of providers/intermediaries and expensive premiums among others.
However, the insurance industry has continued to enjoy steady growth over the years with the insurance market premiums currently being valued at approximately Ksh235 billion. The market, however, remains driven by the general business category with long term insurance premiums standing at Ksh. 102 billion. This accounts for 43.4 per cent of the total premiums underwritten.
“We are witnessing a growth compared to last year (2021) and this is attributed to the Covid-19 recovery measures. Our market, however, is still general business-driven and I call upon Equity Life Assurance to identify strategies of increasing insurance growth in the long-term business,” Commissioner of Insurance & Chief Executive Officer (CEO) IRA Mr Godfrey Kiptum said.
With the entry of Equity Life Assurance Company, the country will now have a total of 62 operational insurance and re-insurance companies.