CORPORATE SCENE
Kenya Reinsurance Corporation : Global Partner in Securing the Future
By Marketing Africa Team
Kenya Reinsurance Corporation was established in 1970 by an Act of Parliament and started operations in January 1971 . It is 60 % owned by government and 40 % by public through Nairobi Securities Exchange . Kenya-Re ’ s core activity is providing reinsurance security and services for most classes of insurance business to over 265 companies in over 62 countries in Africa , Middle East and Asia . This year they are celebrating their Silver Jubilee .
Kenya-Re rebranded in 2012 with a new brand identity which signified their commitment to make a difference to all their stakeholders . In the last 50 years they have grown to be the largest re-insurance company in the region and can be described as we say in marketing a ‘ strong brand ’.
The Corporation has a subsidiary in Abidjan , Ivory Coast that caters for the West African Francophone markets and another in Lusaka , Zambia that caters for the Southern African region , and recently operationalized another subsidiary in Kampala , Uganda .
Kenya-Re , as is popularly known , has investments in real estate spread around Kenya and is the proud owner of landmark commercial buildings including Re-Insurance Plaza , Anniversary Towers , Kenya- Re Towers and Kenya-Re Plaza in Kisumu .
Kenya-Re is rated B ( Fair ) by AM Best International rating Agency and AA + ( Double A ) by Global Credit Rating ( GCR ) Agency of South Africa . It is also ISO 9001:2015 and ISO 27001:2013 certified .
Marketing Africa team sat with the Chief Executive Officer , Mr . Jadiah
Mwarania , who shed light not just on this successful organization he leads , but also spoke candidly on among others the low penetration of insurance in Kenya , his reasons why this is so , and what he opines can be done to reverse this situation .
Unlike Insurance , Re-insurance is not well understood . Kindly define what it is and why it is important ?
Re-insurance involves the transfer or “ ceding ” of some of the financial risk ’ s insurers assume in insuring cars , homes and businesses to another insurance company , the reinsurer . In simple terms , reinsurance is the insurance for insurance companies . Kenya Reinsurance has gone further than this definition to provide risk management solutions that secure the future and create value for stakeholders .
Re-insurance basically is the business of insuring the insurer in effect transferring part of the risk to the reinsurer . This has two advantages . The first is that it provides an additional safety net for the insurance company improving their ability to withstand large claims . This is especially crucial when an unforeseen tragedy occurs such as floods , fires , cyclones and earthquakes which results in large claims which would be a heavy burden for the insurance company to pay and could be a challenge to their solvency . Secondly it increases the confidence of the insurance companies to wade into territories that would be considered risky which they would otherwise shy from .
In a nutshell , re-insurance increases the underwriting capabilities of the insurance providers by giving an additional safety net and reducing their overall exposure . Given insurance companies provide a crucial service to the economy , reinsurance provides them with a critical support pillar . This is the reason why in Kenya it is mandatory , by law , that Insurance companies reinsure 20 % of their total premiums .
Last year you celebrated 50 years since inception . What can you count as among your achievements thus far ?
Indeed we are 50 years old and counting I can confidently say we have achieved a lot even while facing some challenges . To start with we are the oldest and largest re-insurance company in Kenya having been established by an act of Parliament in 1970 and started operations in 1971 . We have a large customer base of 265 Insurance companies spread in over 62 countries .
We are in a strong financial position despite the challenges we continue to face especially now with the Covid-19 pandemic . Our 2020 Financial Statement published recently shows a Gross Written Premium ( GWP ) of KES . 18.5B , an asset base of KES . 53B , an investment of KES . 3.8B , our Shareholders Funds stand and KES . 34B and our profit was KES . 3.7B . Due to prudent management of our resources our operating expenses decreased by 4 %.
Financial strength is important for any business but more so in insurance as it enables one to conveniently meet their obligations as they fall due . To this end we have been very favorably rated by AM Best and GCR and have been ISO certified since 2013 .
We re-branded in 2012 to a new brand identity which signified our commitment to make a difference to all our stakeholders . In the same year , and in keeping in line with
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