A TOUR OF THE EAST AFRICAN INSURANCE MARKET Presented by: Pauline Gathuri Mbugua Association of Kenya Insurers AFRICAN INSURANCE ORGANISATION (AIO) CONFERENCE LOME TOGO

EXECUTIVE SUMMARY  Introduction  East African Region  Premiums per Country  Challenges / Opportunities  Conclusion

THE TRUE SIZE OF AFRICA

AFRICA - POTENTIAL

The East African Community COUNTRYTOTAL POPULATION AGE STRUCTUREPremium Density in US$ Est. as July – 14 YEARS (Distant Future Target Market) YEARS (Immediate Future Target Market) 25–54 YEARS (Current Target Market) 55 and above TANZANIA51,045, %19.5%29.6%6.4%6 KENYA45,925, %18.6%33.2%6.6%30 UGANDA37,101, %21.2%25.9%4.5%5 RWANDA12,661, %18.8%32.7%6.5%4 BURUNDI10,742, %19.2%28.6%6.4%2 TOTAL157,476, %19.5%30.0%6.1%Average Appr. 10 Source: CIA World Fact book The EAC dates back to 1967 it collapsed in 1977 and was officially revived in 2007.

TOTAL PREMIUM – REGION COUNTRYLIFE INSURANCE PREMIUM US Dollars – Billion GENERAL INSURANCE PREMIUM US Dollars – Billion TOTAL PREMIUM US Dollars – Billion INSURANCE PENETRATI ON SHARE OF REGIONS GROSS WRITTEN PREMIUM EXCHANGE RATE TO: US$ KENYA %74%100 TANZANIA (2013 data) %11%2100 UGANDA %9%2612 RWANDA %5%745 BURUNDI (2013 data) %1%1555 TOTAL %

KENYA –STATISTICS AS AT 31 ST DEC 2014 DESCRIPTIONTOTAL Total Insurance Companies 49 Non-Life Insurance Companies 25 Life Insurance Companies 13 Composite Companies (both Life & Non-Life) 11 Reinsurance Companies 6 Licensed Insurance Brokers 198 Licensed Insurance Agents Source: AKI –Insurance Industry Report 5155

GROSS WRITTEN PREMIUM % GROWTHINSURANCE PENETRATION NON-LIFE INSURANCE Ksh Bn (US $ Bn) (US $ Bn) 15.6%1.87% LIFE INSURANCE Ksh Bn (US $ Bn) (US $ Bn) 29.4%1.06% TOTAL PREMIUM Ksh Bn (US $ Bn) Ksh (US $ Bn) 20.3%2.93%

2014 GROSS WRITTEN PREMIUM

UGANDA – STATISTICS AS AT 31 ST DEC 2014 DESCRIPTIONTOTAL Total Insurance Companies 22 Non-Life Insurance Companies 20 Life Insurance Companies 8 Composite Companies (both Life & Non-Life) 6 Reinsurance Companies 1 Licensed Insurance Brokers 27

GROSS WRITTEN PREMIUM % GROWTH INSURANCE PENETRATION NON-LIFE INSURANCE Ushs Bn. (US$ ) Bn. Ushs Bn. (US$ ) Bn. 9.3%- (HMOs)Ushs.56.0 Bn. (US$ ) Bn. Ushs.46.8 Bn. (US$ ) Bn. (16.4)%- LIFE INSURANCE Ushs.55.4 Bn. (US$ ) Bn. Ushs.74.0 Bn. (US$ ) Bn. 33.4%- TOTAL PREMIUM Ushs Bn. (US$ ) Bn Ushs Bn. (US$ ) Bn 9% % 2013 –0.85%

LIFE INSURANCE GROWTH

GROSS WRITTEN PREMIUMS

TANZANIA – STATISTICS AS AT 31 ST DEC 2013 DESCRIPTIONTOTAL Total Insurance Companies 29 Non-Life Insurance Companies 23 Life Insurance Companies 3 Composite Companies (both Life & Non-Life) 3 Reinsurance Companies 1 Licensed Insurance Brokers 90 Licensed Insurance Agents 301

GROSS WRITTEN PREMIUM % GROWTHINSURANCE PENETRATION NON-LIFE INSURANCE TZS Bn. (US$ Bn) TZS Bn. (US$ Bn) 15.1% LIFE INSURANCE TZS 43.7 Bn. US$ Bn) TZS 56.4 Bn. US$ Bn) 29.2% TOTAL PREMIUM TZS (US$ Bn) TZS Bn. (US$ Bn.) 17.1%2013 – 0.9%

GROSS WRITTEN PREMIUMS

RWANDA – STATISTICS The insurance industry in Rwanda compromises of eight players; 7 Private Insurance Companies; 5 and 3 Public Insurance Companies. The Industry Regulator and Supervisor has licenses more than 70 agents. The insurance sector recorded a Gross Premium Income of Rwf 82 Billion (US$ Bn.) by the end of 2014 from Rwf 76 Billion (US$ Bn.) as at December 2013.

RWANDA - LIFE BUSINESS Life Insurance accounted for 21.1% of the gross premium at Rwf 8 Billion (US$ Bn.). The outlook of growth in this market is very positive. Insurance Penetration – 0.6%

BURUNDI There are 6 Insurance Companies, 5 of which are Composite Companies(Both Life and Non Life) and one General Insurance Company. The market recorded a Gross Written Premium of BIF 25.9 Billion (US$ Bn). Life Insurance accounted for 26.04% of Gross written Premiums Non Life Insurance accounted for 73.96% of Gross Written Premiums. Insurance Penetration - 0.5%.

CHALLENGES / OPPORTUNITIES 1. Distribution Channels

……..LOW PERSISTENCY

2. LOW PERSISTENCY

3. Unreached informal sector

GROUP LIFE BUSINESS 4. Un-healthy competition leading to under- cutting.  Competing in Known Market Space  Broker Driven Market  SME Market  Current Group Life Schemes vs. Current No. of Employers

Red Ocean vs. Blue Ocean