The general insurance business posted an underwriting loss of Sh7 billion New industry data shows motor insurance generated the largest underwriting loss of any insurance class in 2025 /AI Generated Kenya's motor insurance business is becoming increasingly difficult to sustain, with rising claims and operating costs pushing insurers deeper into losses despite another year of robust growth across the wider insurance industry.
New industry data shows motor insurance generated the largest underwriting loss of any insurance class in 2025, recording a combined loss of Sh8.2 billion as claims payouts and expenses continued to outpace premiums collected. The deterioration points to a growing financial strain facing insurers in one of Kenya's most popular but least profitable insurance segments.
The latest industry performance report by the Insurance Regulatory Authority (IRA) shows that while Kenya's insurance sector expanded strongly last year, the gains masked persistent weaknesses in general insurance, particularly motor cover. IRA chief executive officer Godfrey Kiptum said that despite gross written premiums rising by 17.6 per cent to Sh464.72 billion and assets growing to Sh1.47 trillion, motor fraud remains a major threat.
Overall, the general insurance business posted an underwriting loss of Sh7 billion in 2025, worsening from a Sh5.2 billion loss recorded a year earlier. “The industry's combined ratio, which measures claims, commissions and operating expenses against earned premiums, climbed to 104.5 per cent, indicating insurers paid out more than they earned from underwriting before investment income was taken into account,” said Kiptum.
Six of the thirteen general insurance classes recorded combined ratios above 100 per cent, signalling widespread underwriting losses across the sector. Motor insurance remains one of the largest lines of business in Kenya, accounting for 27.1 per cent of general insurance premiums, second only to medical insurance, which contributed 41.1 per cent.
However, its large market share has not translated into profitability. Insurers continue to grapple with a combination of rising accident-related claims, escalating vehicle repair costs driven by inflation and expensive imported spare parts, fraud, legal compensation costs and intense price competition that has kept premiums relatively low.