A recent report from the Insurance Regulatory Authority (IRA) sheds light on the dynamic landscape of the insurance industry in Kenya, revealing a notable upswing in claims payouts during the third quarter of 2023.

Insurance companies disbursed a total of Sh7.49 billion in claims during this period, marking an 11.9 per cent increase compared to the preceding quarter's payout of Sh6.7 billion in 2023.

The comprehensive data, covering July to September 2023, discloses intriguing insights into the sector's performance, with approximately 2.1 million claims settled, a substantial 17.5 per cent surge from the same period in the previous year when 1.80 million claims were processed.

Breaking down the figures, the report highlights specific categories such as general liability and non-liability claims, which accounted for 14,321 and 1,978,535 claims, with corresponding payouts of Sh5.25 billion and Sh18.36 billion, respectively.

In the long-term insurance sector, insurers disbursed Sh3.88 billion against 119,582 claims during Q3 2023, contributing to an overall tally of over 3.36 million claims processed by the industry.

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Zooming in on general liability claims, the data indicates that 162,829 claims were settled, amounting to Sh38.29 billion.

Although the number of claims increased, the payout decreased compared to Q2 2023 when 158,747 claims were settled for Sh38.51 billion.

Similarly, general non-liability claims witnessed an increase in the number of claims from 2,848,970 to 3,044,402, while the total payout decreased from Sh58.34 billion to Sh57.54 billion in the same period.

The long-term insurance business also experienced a surge in both the number of claims and total payouts. Underwriters processed 156,590 claims, totalling Sh33.45 billion, reflecting an upward trend from Q2 2023 figures of 144,056 claims and Sh30.18 billion.

According to the report, there is a detailed exploration of changes in claims payment ratios. 

"In Q3 2023, the claims payment ratio for general liability claims decreased slightly to 8.80 per cent with respect to the number, while it increased to 13.72 per cent with regard to the amount (Q2 2023: 8.87 per cent and 12.62 per cent, respectively)," the report states.

"The claims payment ratio for general non-liability claims decreased to 64.99 per cent in respect of numbers but increased to 31.92 per cent in respect of amounts in Q3 2023 from 67.92 per cent and 29.70 per cent in Q2 2023, respectively."

In contrast, the claims payment ratio for the long-term insurance business saw an improvement, reaching 76.37 per cent in terms of numbers and 71.40 per cent in terms of amounts, compared to 75.27 per cent and 67.05 per cent observed in Q2 2023.

The recent report paints a comprehensive picture of the evolving trends in the insurance industry, showcasing shifts in claims processing and payouts during the third quarter of 2023.