In Kenya’s tough economic climate, where the cost of living is skyrocketing, owning a car can feel like more of a burden than a blessing—especially when it comes to motor insurance.
Annual lumpsum premiums are forcing car owners to dig deep into their pockets, spending up to 10 percent of their car’s value on insurance. For most, that’s just too much to handle.
Take comprehensive insurance, for instance. Depending on your car’s value, you could be looking at anywhere between Sh35,000 for a small car to well over Sh200,000 if you’re driving a high-end vehicle.
Because of these hefty costs, many Kenyans opt for basic third-party insurance, which typically costs between Sh10,000 and Sh15,000.
While this might be easier on the wallet, it leaves them exposed in case of accidents, theft, or worse since it only covers third party property damage and bodily injuries.
Although Kenya’s motor insurance sector raked in Sh54 billion last year, comprehensive insurance penetration remains low.
The truth is, many people simply can't afford the upfront lumpsum cost, and that’s a huge problem.
With over 40 percent of Kenyans living below the poverty line, it’s no surprise that large lump-sum payments for insurance are often out of reach.
So, what’s the solution? Flexible payment plans. Just imagine paying your insurance premiums in smaller, more manageable monthly installments instead of one big chunk. It would ease the pressure and help families budget better, ensuring they don’t have to sacrifice safety to make ends meet.
But it’s not just about affordability; it's also about peace of mind. When premiums are more manageable, there’s less risk of policies lapsing.
This means car owners can keep their vehicles covered all year round, without the fear of being caught off guard by an accident or theft.
After all, continuous coverage is essential, especially for those who rely on their cars for work or daily commuting.
We all know that a car accident or breakdown can set you back financially. The National Transport and Safety Authority (NTSA) estimates that road crashes in Kenya cause over Sh450 billion in annual losses, a figure that’s staggering, to say the least.
The numbers are clear. Recent data from the Insurance Regulatory Authority (IRA) shows that motor vehicle insurance made up 27.5 percent of all gross written premiums.
Yet, insurers are seeing more claims because the cost of spare parts and repairs has shot up, driven by the devaluation of the shilling and rising import prices making motor insurance more expensive. It’s no wonder many car owners are tempted to switch to cheaper, less comprehensive options.
But here’s where insurers can stand out. By offering affordable and flexible payment options, they can attract new customers and keep their current ones happy. This isn’t just good for business—it’s a win-win for everyone. Clients get the coverage they need, and insurers strengthen their market position.
In fact, expanding access to comprehensive motor insurance through flexible payment plans could significantly boost Kenya’s general insurance sector, currently valued at around Sh1 trillion.
As more Kenyans opt for comprehensive coverage, thanks to improved affordability, the market is bound to grow.
The writer is Britam General Insurance Acting CEO and Principal Officer
