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Survey reveals Bancassurance potential for growth
Bancassurance in Kenya is still in its nascent stages having started in 2004 when the first commercial bank was licensed by the Central Bank to sell insurance products. Today, 26 banks are offering bancassurance services. Bancassurance is an arrangement where banks sell insurance products alongside their other products.
AKI commissioned a baseline survey on the bancassurance market in the country during the last quarter of 2017. The objective of the survey was to understand the model adopted by players, the gaps that exist as well as its performance thus far. The study was completed early this year and was disseminated to members in March 2018.
Bancassurance channelled Ksh6 billion of life business gross premium in 2016 contributing to 8.12 per cent of written premium. Credit Life insurance contributed the largest chunk of the bancassurance life business at 85 per cent. During the same period, approximately Ksh10 billion premium was collected through bancassurance for non-life business, representing 8.23 percent of total non-life written premium. Motor insurance, both private and commercial, was the fastest moving product at 56 per cent.
The distribution model has been adopted by a majority of the Kenyan players. This model enables a bank to sell insurance products from a wide variety of insurance companies.
The survey revealed that with simplification of insurance products, increased and practical training of the bancassurance sales agents, integration of technology and aggressive marketing; bancassurance is likely to grow as an insurance distribution channel and also increase penetration of insurance in the country.
Read the full report here
Bancassurance in Kenya Market Assessment Study 2017 Final
Bancassurance Market Assessment Study 2017