In a major leap for Kenya’s financial services sector, a Bill I had the honour of sponsoring in the National Assembly—The Insurance Professionals Bill, 2024—was this week signed into law by President William Ruto.
This legislation marks the first time in our country’s history that insurance professionals—from underwriters and agents to actuaries and loss adjusters—will be subject to statutory regulation, ethical oversight, and professional development standards.
For a sector that has historically struggled with public trust, information asymmetry, and low uptake, this law couldn’t have come at a better time.
According to the Insurance Regulatory Authority (IRA), insurance penetration in Kenya stood at 2.4 percent of GDP in 2023, a marginal increase from 2. percent in 2022. While gross written premiums reached Sh361 billion, and paid claims surged to over Sh94 billion, the sector still lags well behind global averages, which hover around 7.0 percent, and even regional peers like South Africa (13.7 percent).
Despite rising premiums and product diversification, the uptake of insurance products—especially among low-income populations and informal sectors—remains persistently low.
This has been attributed to multiple factors: lack of trust, limited understanding of products, poor claims experience, and most importantly, a lack of professional accountability among frontline insurance providers. The new law seeks to confront these challenges head-on.
The cornerstone of the new law is the creation of the Insurance Institute of Kenya (IIK)—a statutory professional body responsible for regulating, licensing, and developing insurance practitioners.
Every professional in the sector will now be required to obtain a practicing certificate through a formal process involving professional examinations, ethics training, and continuous professional development (CPD).
This professionalisation aligns Kenya with best practices in countries like the UK, South Africa, and Ghana. Through the newly established Insurance Professionals Examinations Board, the law ensures technical competence and allows recognition of global certifications such as the Chartered Insurance Institute (CII), Actuarial Fellowships, and the CFA. The law also establishes a Disciplinary Committee with quasi-judicial powers to investigate misconduct, suspend licenses, and impose sanctions.
Stakeholder Endorsements
“Professionalisation via statute will rebuild trust—ultimately driving deeper market penetration,” noted Stella Njunge, Executive Director of the Association of Kenya Insurers (AKI).
A senior official at the Insurance Regulatory Authority remarked, “We’ve seen claims from catastrophic risks like floods surge to Sh5 billion. This law ensures that practitioners are equipped to underwrite and price such risks with professionalism and discipline.”
Philip Lopokoiyit, CEO of ICEA Lion, added, “By formalising the industry’s human capital base, this law can anchor product innovation—especially around parametric and climate-related insurance solutions that require both technical and ethical rigour.”
Professionalising the insurance sector is not merely a formality—it is a direct lever for expanding access. When clients know they are dealing with certified, accountable professionals, confidence grows, product uptake increases, and retention improves.
As trust builds, so does uptake—translating into real progress on Kenya’s goal of achieving at least 5 percent insurance penetration by 2030. That growth can bring significant fiscal and social benefits, from reducing government relief expenditure during disasters to deepening household financial resilience.
A foundation for future growth
The Insurance Professionals Act also positions Kenya to compete regionally. As the African Continental Free Trade Area (AfCFTA) opens up cross-border insurance markets, a professionalised local sector enhances Kenya’s ability to export insurance services, attract reinsurers, and partner with global players.
With climate change, pandemics, cyber threats, and digital innovation transforming risk profiles globally, this law ensures that Kenya’s insurance workforce is not only prepared—but empowered—to lead.
Final Word
For decades, the insurance sector in Kenya has operated with one foot in informality. The enactment of this law changes that. It is not just a regulatory upgrade—it is a strategic decision to build trust, enhance transparency, and unlock the full potential of insurance as a driver of inclusive economic growth.
It is now up to all of us—regulators, insurers, educators, and professionals—to make this vision real. The tools are in place. The standards are set. The future begins now.
The writer is the Chairperson of the Departmental Committee on Finance and National Planning, National Assembly.
