Kenya micro-insurance company, Insurance for All (IFA) limited is looking to expand its business and reach in Kenya in a move to capture the huge uninsured market in the country as it aims to increase provision of insurance solutions to for low income earners and those in the informal industry. This is after signing a stake acquisition agreement with UAE based firm AJ Capital & Investment LLC that will control 51% stake henceforth.
Under the deal, AJCI will inject equity capital to enable IFA roll out innovative and affordable health insurance solutions. The insurer, founded in 2014, offers health covers for as low as Ksh6,750 per annum and currently boast over 1600 customers.
“IFA has since inception four years ago developed expertise in serving the uninsured market in Kenya, in particular, the micro-health insurance segment. This was an attractive investment proposition to us given the strong growth prospects for affordable medical insurance in Kenya,” said Chief Executive Officer, Mr. Danny Ochieng
The acquisition of a stake in Insurance for All by AJCI comes against the backdrop of accelerated investment by local and foreign PE funds in Kenyan businesses across sectors like financial services, manufacturing, hospitality, education, health care and ICT.
Private Equity firms pumped an estimated Ksh120 billion ($1.2 billion) billion into local enterprises in 2017-2018 according to the East Africa Private Equity and Venture Capital Association. Insurance penetration in Kenya remains low with a paltry three per cent of the population said to have access to any form of risk cover. The Ministry of Health estimates that 75 per cent of the population finances their health expenses out of pocket.
As such, several health insurance products designed for the low income market have been launched in Kenya in recent years. With this, it is expected that demand for micro-health insurance products will continue to grow.