The approach to regulating the insurance industry in Kenya through the Insurance Regulatory Authority (IRA) recognizes that different types of insurance companies require different approaches thereby introducing flexibility into the regulatory process and a ‘risk based’ approach to regulation and supervision.
Regulatory Framework
A Kenyan Insurance company is regulated by the Insurance Act and Related Regulations as amended (“Insurance Act”) and the Companies Act. The Insurance Act requires that every Insurer conducting business in or from Kenya be registered under the Insurance Act. The approach to regulating the insurance industry in Kenya through the Insurance Regulatory Authority (IRA) recognizes that different types of insurance companies require different approaches thereby introducing flexibility into the regulatory process and a ‘risk based’ approach to regulation and supervision.
The IRA has published a Good Governance Framework (‘the Framework’) which has been made pursuant to Section 3 of the Insurance Act (‘the Act’). The Framework relate to the Authority’s decisions on whether to register an entity, to cancel the registration of a registered entity, to impose conditions upon a registration, or to give certain directions to a registered entity. This Framework is of general application and seeks to take account of the wide diversity of registered entities that may be licensed under the Act, as well as relevant institutional and market developments.
An Insurer may be registered to conduct either long term business (life, certain annuity and personal injury contracts) or general business (everything that is not long term business) and different regulations apply depending on the type of business carried on by the Insurer.
The different classes of insurance licenses for general business have been established in recognition of the diversity of insurers currently operating in or from Kenya. It must be noted that within each license class different regulations will apply.