A recent article in the Nairobi-based Business Daily Africa newspaper stated that insurance companies in Kenya are increasingly looking towards microinsurance ventures to boost their profits. According to the article, the number of firms offering microinsurance has increased from one to six in the last three years.
“The formal insurance market is saturated and we are looking at micro-insurance as an area that makes a profound impact on most of the population,” said Mr James Wambugu, Chief Executive Officer of Nairobi-based UAP Insurance, which recently launched a microinsurance program covering livestock and crops.
While the article claims that most microinsurance products are embedded in microcredit products, it argues that non-embedded, voluntary products are possible and already exist in Tanzania, Uganda and India.
By Stefanie Rubin, Research Associate
About UAP Insurance Limited:
UAP Insurance Limited is an insurance provider based in Nairobi, Kenya, that operates in Kenya, Uganda, and Southern Sudan. It was formed in 1994 after the merger of Union Insurance and Provincial Insurance. The company’s products include commercial, life, travel, corporate medical, and political violence and terrorism insurance. Additionally, along with Equity Bank, a commercial bank in Kenya, UAP Insurance has launched a program that incorporates satellite technology to provide herders with insurance for their livestock in the event of drought and subsequent starvation.
According to its 2008 financial statements, UAP had KES 9.4 billion (USD 121.5 million) in total assets, KES 446 million (USD 5.8 million) in taxes before profit and an investment income of KES 382 million (USD 4.9 million) as of year-end 2008.
Additional Resources:
Source Article: Business Daily Africa: Insurers Turn to Low-End Niche to Boost Profits
MicroCapital Universe: UAP Insurance Limited
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