- Insurers are being urged to introduce flexible, technology driven products to better serve SMEs and informal sector businesses.
- Experts say SMEs need affordable, modular insurance cover that matches their cash flow and operational risks.
- The industry is expanding digital services and regional presence to improve insurance access across Kenya.
Kenya’s insurance industry is being urged to abandon rigid traditional products in favour of flexible, customer-focused and technology-driven solutions to attract more consumers, particularly those in the informal sector and small businesses.
Industry experts argue that the long-standing model of annual premiums, extensive paperwork and claims-based engagement no longer meets the needs of a market dominated by a growing informal economy, digitally connected youth and businesses facing economic uncertainty.
Stephen Lokonyo, Managing Director at First Assurance, said insurers must develop products that reflect the financial realities of ordinary Kenyans.
“For the average Kenyan, insurance is often viewed as a luxury or an opaque financial burden rather than a protective asset,” said Lokonyo.
He noted that flexible payment options such as daily, weekly or pay-as-you-go insurance could help make coverage more affordable, mirroring the success of mobile money platforms that have transformed access to financial services.
The industry is also being encouraged to integrate insurance into digital platforms such as ride-hailing applications, e-commerce marketplaces and agricultural supply chains, allowing customers to purchase cover as part of their everyday transactions.
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Small and Medium-Sized Enterprises (SMEs), which account for more than 80 percent of employment in Kenya, remain largely underserved despite their contribution to the economy.
Experts say many SMEs consider conventional insurance policies costly and unsuitable for their operational needs. Instead, businesses are increasingly demanding modular insurance packages that allow them to choose specific covers, including fire, theft or political violence, and adjust protection according to business performance and cash flow.
Lokonyo added that corporate clients are also seeking more customised insurance products to address emerging risks such as cyberattacks and climate-related supply chain disruptions.
“Corporate clients are demanding a shift toward co-creation. Insurers must act as strategic partners, working alongside corporate risk managers to build bespoke, parametric insurance solutions,” he said.
Some insurers have already begun introducing more tailored products aimed at reducing barriers to insurance uptake. These include flexible medical plans for small businesses, broader health benefits such as mental health services and preventive care, as well as premium financing options that reduce the need for large upfront payments.
By Jonathan Mwinzi
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