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Mauritius Union Assurance (MUA), formerly Phoenix East Africa Assurance, will continue with its quest to acquire small operators in a bid to increase its Kenyan market share by between 4 and 5 percent by 2020, said chief executive for Kenya and East Africa market Ashraf Musbally.
The insurer said in an interview with Financial Fortune Media, that it is determined to achieve the target despite the current macro-economic conditions in the unpredictable industry.
“I know it is an ambitious target, but we have all the requisite requirements to grow our market share. And this can be explained by the fact that we have continuously improved our revenues since we entered Kenya,” said Musbally.
The regulatory changes made in 2016 resulted in the increase of costs for some insurance companies. This may have directly resulted to increased capital injection into insurers especially those that were moving into the general insurance space.
The firm further revealed that it will not venture into health insurance citing current premium charged for health covers as being unsustainable given the high levels of fraud in Kenya which is a common problem all insurers face.
The insurer said health insurance is not on its immediate list of expansion as it makes Sh3 billion investment in new and existing products to grow its market share with the firm keen to instead prioritize strengthening general insurance business and launching life insurance through acquisition model.
“It is something we can look to do in the future, right now our main focus in on partnerships, new products such as ‘utulivu’ as we look for gradual growth,” he said, with main focus on market Penetration, Business Development; Internal Efficiency & Cost Control, E-commerce, Agent Sales Platform, Client Portal and Digital Innovation.
MUA presently has about one per cent market share in Kenya, where it owns part of Phoenix of East Africa Assurance Company. MUA competes in Mauritius with companies including Swan General Ltd, Mauritian Eagle Insurance Company and two State-owned operators. Kenya accounted for five per cent of income in 2017, according to figures by industry regulator, Insurance Regulatory Authority (IRA).
Political and regulatory upheavals around the world are changing some of the ground rules about how carriers may operate. An accelerating evolution in the way business is conducted is being driven by innovation and higher customer expectations, while disruptive newcomers are looking to take market share from incumbent insurers.
The industry as a whole experienced an underwriting loss of Kes 1.65 Billion in 2018. Making it the biggest loss experienced in the past 10 years with the total profit after tax down from Kes 11.05 Billion to Kes 6.82 Billion in 2018 as both claims and management expenses increased across the board.