Insurance companies settled 7.4 per cent of total claims during the first three months of the year compared to 10.8 per cent the previous quarter, the regulator said late Tuesday, citing company filings.
The Insurance Regulatory Authority said the industry paid 9,751 claims in the January-March period out of the 131,788 total claims, underlining the lengthy settlement process amid rising cases of fraud. This left a backlog of 121,288 claims, 3,693 more than 117,595 claims at the end of December 2016.
A total of 1,742 claims were revived during the quarter, the IRA quarterly claims statistics shows. Only 0.7 per cent of the total claims were rejected in the review period. The regulator did not give the value of the claims.
The value of claims in 12 months through December 2016 climbed by Sh4.57 billion, or 9.30 per cent, year-on-year to Sh53.70 billion from Sh49.13 billion incurred in 2015, the regulator said in fourth quarter 2016 report on March 24.
“The loss ratio under general insurance for the period under review was 62.3 per cent compared to 61.5 per cent in 2015,” IRA had said in the report.
In the first three months of the year, Madison Insurance posted the highest claims settlement ratio at 35.14 per cent, or 434, of 1,235 claims on its books.
Intra Africa settled 326 of its 1,426 claims, giving it the second highest ratio of 22.9 per cent, which is, however, lower than 50.2 per cent in the previous quarter. Invesco came third, after it settled 19.1 per cent, or 1,506, of its 7,890 total claims, followed by African Merchant ( 18.6 per cent ) and the Kenyan Alliance ( 16.6 per cent ).
Other top performers in settling included Mayfair – associated with Nairobi gubernatorial aspirant Peter Kenneth – at 13.8 per cent, Kenindia ( 13.7 per cent ), Pacis ( 11.8 per cent ), Phoenix ( 11.7 per cent ) and Geminia ( 10.1 per cent ). Directline and Xplico also outperformed the industry’s average settlement ratio with a score of 7.6 per cent each, while APA’s performance was at par with industry at 7.4 per cent.
Trident was among the worst performers with a claim settlement ratio of 0.76 per cent of 2,502 total claims. Large-sized firms were among the under-performers. UAP Insurance paid 1.4 per cent, or 59, of 3,814 claims on its books, Jubilee settled 2.59 per cent, or 42, out of 1,621 total claims, while ICEA Lion General had a ratio of 2.7 per cent, or 262, of 9,860 total claims in its files.
Britam General which had the highest claims in the industry at 15,141 paid 583 claims, or 4.3 per cent of the total, Sanlam General settled 3.9 per cent of its 1,148 claims, while CIC recorded a settlement ratio of 5.7 per cent of 4,937 claims.
Underwriting loss incurred by insurance companies in the general business deepened by 458.55 per cent in 12 months through December 2016 largely on rising claims, Insurance Regulatory Authority data showed on Friday.