NAIROBI, Kenya, Jan 11 – Equity Group has been granted a license to venture into the Insurance Business by the The Insurance Regulatory Authority (IRA).
The firm will operate the new venture under Equity Life Assurance, a fully-fledged business with separate structures and commercial arrangements in line with the IRA regulations.
Commissioner of Insurance and Chief Executive Officer (CEO) IRA Godfrey Kiptum reiterated that the diversification strategy and entry of Equity Group into the insurance market is proof that the insurance industry in Kenya continues to be attractive to investors.
“We continue to receive interests from foreign-based financial institutions ranging from brokers, insurers, re-insurance brokers, and re-insurance companies looking for investments in the Kenyan Assurance market. This underscores the position of Kenya as a viable investment destination,” he said.
The move is set to increase revenue stream for the lender going forward.
In the nine months to September 2021, Equity Group reported 78.6 percent growth in profit after tax to hit Sh26.8 billion compared to Sh15 billion posted in the same period last year on account of the growth of non-funded income and reduced costs.
Non- funded income went up by 28.8 percent to Sh31.9 billion including fees and commission income on loans, bond and forex trading income while net interest income from both loans and advances, and from investment in government securities rose by 23 percent to Sh48.4 billion.
Kenya’s insurance industry has continued to enjoy steady growth over the years with the insurance market premiums currently being valued at approximately Sh235 billion.
The market, however, remains driven by the general business category with long-term insurance premiums standing at Sh102 billion. This accounts for 43.4percent of the total premiums underwritten.
“We are witnessing a growth compared to last year 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,” he added.
Kiptum said that the government through the IRA is committed to providing an enabling environment to ensure that the insurance sector remains competitive. “Kenya is among the best-performing countries in Africa in insurance business largely due to innovative distribution channels, a liberalized market, and strong regulation,” he concluded.