NAIROBI, Kenya – The number of Kenyans using insurance has declined in recent years, reflecting growing financial pressures and irregular incomes, the 2024 FinAccess Household Survey reveals.
According to the survey, insurance usage—excluding the now-defunct National Health Insurance Fund (NHIF)—dropped from 1.9 million in 2021 to 1.77 million in 2024, a decrease of 130,000 users.
This trend signals the broader impact of reduced disposable income across households, particularly in the informal sector.
The report attributes the decline to income instability. “The majority of Kenyans work in the informal sector, where incomes are irregular. Traditional insurance requires fixed regular premium payments, and failure to meet these payments leads to policy lapses,” the survey notes.
This has discouraged many individuals from purchasing or retaining coverage.
The report also highlights disparities in insurance usage across gender and employment sectors.
Men are more likely to have insurance coverage compared to women, though precise figures were not disclosed.
Employment status further determines insurance uptake: Employed individuals lead the pack with 660,000 users, self-employed workers follow with 450,000, and casual laborers and dependents trail far behind, with only 140,000 and 240,000 users, respectively.
The survey links this trend to income stability, as formal employment often includes employer-sponsored insurance plans or allows individuals to afford premiums.
Mobile money continues to dominate as the preferred method for paying insurance premiums, with 49 per cent of respondents using mobile platforms.
Employer-paid contributions account for another 43 per cent.
However, the report exposes challenges in claims settlement. Over 44 per cent of respondents said overdue premium payments led to claim rejections, with men slightly more affected (45.5 per cent) than women (42 per cent). Additionally:
39 per cent cited exclusions in policy risk coverage as reasons for rejected claims.
26.5 per cent reported refusals by NHIF or private insurers to process claims.
These findings point to a lack of awareness regarding policy terms and conditions, contributing to frustrations when claims are denied.
While insurance remains an essential safety net, the 2024 FinAccess Household Survey underscores critical challenges facing the sector.
Irregular incomes, difficulties in paying premiums, and a lack of policy awareness continue to limit insurance uptake among Kenyans, particularly those in informal employment.
According to the survey, insurance usage—excluding the now-defunct National Health Insurance Fund (NHIF)—dropped from 1.9 million in 2021 to 1.77 million in 2024, a decrease of 130,000 users.
This trend signals the broader impact of reduced disposable income across households, particularly in the informal sector.
The report attributes the decline to income instability. “The majority of Kenyans work in the informal sector, where incomes are irregular. Traditional insurance requires fixed regular premium payments, and failure to meet these payments leads to policy lapses,” the survey notes.
This has discouraged many individuals from purchasing or retaining coverage.
The report also highlights disparities in insurance usage across gender and employment sectors.
Men are more likely to have insurance coverage compared to women, though precise figures were not disclosed.
Employment status further determines insurance uptake: Employed individuals lead the pack with 660,000 users, self-employed workers follow with 450,000, and casual laborers and dependents trail far behind, with only 140,000 and 240,000 users, respectively.
The survey links this trend to income stability, as formal employment often includes employer-sponsored insurance plans or allows individuals to afford premiums.
Mobile money continues to dominate as the preferred method for paying insurance premiums, with 49 per cent of respondents using mobile platforms.
Employer-paid contributions account for another 43 per cent.
However, the report exposes challenges in claims settlement. Over 44 per cent of respondents said overdue premium payments led to claim rejections, with men slightly more affected (45.5 per cent) than women (42 per cent). Additionally:
39 per cent cited exclusions in policy risk coverage as reasons for rejected claims.
26.5 per cent reported refusals by NHIF or private insurers to process claims.
These findings point to a lack of awareness regarding policy terms and conditions, contributing to frustrations when claims are denied.
While insurance remains an essential safety net, the 2024 FinAccess Household Survey underscores critical challenges facing the sector.
Irregular incomes, difficulties in paying premiums, and a lack of policy awareness continue to limit insurance uptake among Kenyans, particularly those in informal employment.
