Kenya’s Motor Insurance Sector Embraces Innovation for a Tech-Savvy Generation

The lifestyle of today’s motorists is cashless, paperless, and mobile-driven. To keep pace with evolving customer needs, motor underwriters have invested in product innovations tailored to meet modern preferences.

Initially, it was common for motorists to opt for third-party insurance only. However, the current trend shows most customers now seek comprehensive risk management solutions that cover vehicles and offer a broader range of benefits and services.

Secondly, while insurance products were primarily sold through agencies and brokerage firms, Kenya has experienced a digital revolution. This shift has spurred the development of mobile platforms, creating a marketplace for insurance products.

This “digital migration” can largely be attributed to Kenya’s tech-savvy population, driven by the widespread use of smartphones and increased internet penetration. As of the latest reports, internet usage in the country stands at 32.7%, accounting for 17.86 million users.

According to the Communications Authority of Kenya, mobile devices reached 67 million in the last quarter of 2023, representing a penetration rate of 127.5%. Feature phones account for 60.6% of the market, while smartphones make up 58.3%. Offering risk management solutions through digital platforms provides an unparalleled opportunity to connect with consumers nationwide, 24/7, including weekends and holidays.

Earlier this year, CIC made strides in digitizing motor vehicle insurance with the introduction of Easy Bima. This innovative product offers flexibility, making insurance more affordable by allowing clients to spread the cost of comprehensive car insurance over 12 months. The product has been well-received, with peak activity reaching up to 200 insurance purchases in a single day.

This highlights how innovative solutions are being tailored to address the economic challenges many Kenyans face today, where disposable income has been affected by rising costs and inflation. Unlike traditional motor insurance, CIC’s Easy Bima adopts a customer-centric approach, particularly in these challenging economic times. Customers make an initial payment of 20% of the total premium, with the remaining balance spread over 12 equal monthly installments.

This flexibility aims to make motor insurance more accessible while unlocking much-needed capital for both individuals and businesses. As a result, Kenyans can now protect their valuable assets without straining their finances.

The Kenyan insurance industry is embracing technological innovations more than ever, both in internal operations and customer-facing services. In motor insurance, telematic insurance is gaining traction, where motorists are rewarded for good driving habits with lower premium payments.

These advancements demonstrate a commitment to making insurance more affordable, accessible, and seamless, ensuring the industry stays competitive in an increasingly dynamic market.