Kenya Reinsurance Corporation (Kenya Re) has posted an impressive 336% increase in its insurance service profit, reaching Ksh2.95 billion for the financial year ending December 31, 2024. The significant growth, up from Ksh0.7 billion in the previous year, has positioned the state-backed reinsurer as one of the top gainers at the Nairobi Securities Exchange (NSE), with its share price climbing 3.5% to close at Ksh2.07.
The stellar performance was driven by prudent underwriting practices, strategic diversification, and a favorable macroeconomic environment. Kenya Re’s total assets increased by 1.3% to Ksh66.8 billion, while shareholders’ funds grew by 3% to Ksh49.7 billion. Operational efficiencies played a key role in the improved profitability, with insurance service expenses dropping by 20% to Ksh10.5 billion from Ksh13.1 billion in 2023. Additionally, total investment income rose by 23% to Ksh5.6 billion compared to Ksh4.6 billion in the previous financial year.
Group Managing Director Dr. Hillary Wachinga attributed the strong results to Kenya Re’s continuous adoption of innovative risk management solutions and technological advancements aimed at enhancing customer satisfaction. “As part of our growth trajectory, we are exploring innovative risk management solutions and product offerings to cater to the evolving client needs,” he said.
Despite the impressive growth in underwriting profit, Kenya Re’s overall profitability dipped by 11%, impacted by global economic challenges. The ongoing Russia-Ukraine war, the Israel-Palestine conflict, and domestic economic disruptions, including Gen Z-led protests, weighed on the broader financial outlook.
Looking ahead, Kenya Re is aggressively pursuing expansion opportunities. The corporation plans to establish a subsidiary in Tanzania and a branch in India within the next four months as part of its strategy to capture new markets in Africa, the Middle East, and Asia. Furthermore, the company has begun exploring opportunities in South America, having recently secured its first portfolio in the region.
Dr. Wachinga highlighted that while the life insurance sector is expanding in various international markets, Kenya is also making strides in this segment. He cited India as an example where life insurance penetration is significantly higher than non-life insurance, suggesting growth potential for Kenya in this domain.
Kenya Re’s bold expansion and innovation-driven approach position it for sustained growth in an increasingly dynamic global reinsurance market.
