August 2018 BusinessDaily;Uptake of medical cover in private insurers dropped for the first time in history last year, fresh industry statistics indicate, condemning growth in non-life insurance business to a 16-year low.
Gross premiums in the medical class dropped 0.71 per cent to Sh38.42 billion in 2017 from Sh38.7 billion a year earlier, the industry’s annual report showed, reflecting the impact of enhanced benefits by the National Hospital Insurance Fund (NHIF).
Association of Kenya Insurers (AKI), the industry lobby which compiled the data based on audited financial statements, has attributed the dip in medical insurance cover to competition from the social insurer, which is being readied for the planned universal healthcare by 2022.
“NHIF has come out very aggressively in tapping into the same market where private insurers have been playing. The moment NHIF expands its benefit package and the cost is cheaper, you would expect that a good number of people who will probably be going to private medical insurers are likely to get attracted to NHIF,” AKI chief executive Tom Gichuhi said.
“We didn’t know the impact that NHIF will have until we prepared those numbers.” Mr Gichuhi said the industry had started looking for new strategies on its medical cover offering and pricing to stave off the rising competition from NHIF. The State-run social medical scheme has in the past few years enhanced the out-patient benefit package and is now covering consultation in low-end facilities, lab tests, drugs, and ultrasound and imaging services such as MRI and CT scans.