Tuesday’s terror attack in Nairobi will have a minimal impact on Kenya’s economic growth this year due to the high investor confidence from the international community.
This is according to Sanlam Kenya Group CEO, Patrick Tumbo who cites the 19 billion shillings gain in market capitalization at the Nairobi Securities Exchange Wednesday, a day after the terror attack.
Most economic analysts have projected the Kenyan economy to grow at between 5.5 to 6 percent this year driven by agriculture, manufacturing and the service sectors.
“This year and moving on, Sanlam Kenya will be focusing purely on our insurance businesses as we pursue a consolidated group synergies strategy. We are well positioned and resourced to meet business needs and service clients locally and across the borders as part of Africa’s largest non-bank financial services firm; the Sanlam Group,” Tumbo said, adding that, “This strategy will seek to leverage sales and distribution synergies between Sanlam General Insurance and Sanlam Life Insurance through improved customer experience, while sustainably growing revenue profitably for the good of all stakeholders.
Even though Kenyans were projecting a positive economic growth for the country this year, some are concerned that the terror attack at 14 drive complex in Nairobi could be among risks for the economy.
However, data from the Nairobi Security Exchange indicate that on Wednesday, a day after the terror attack, the market posted better numbers such as the market capitalization increasing by 19 billion shillings and bond value rising by half a billion shillings.
Experts believe this is a vote of confidence by investors in the Kenyan economy.
Even as insurers plan to intensify market sensitization on products, they are encouraging Kenyans to embrace insurance especially for life and household goods noting that the industry is engaging electronic manufacturers to develop ideal insurance products.
Sanlam Kenya has diversified from the investment business to concentrate on general and life insurance in its strategy to capture new market segments with disposable incomes and rising demand for insurance service.
The consolidation of oursubsidiaries nerve centres provides a good foundation for Sanlam Kenya toenhance its operating efficiencies through a unified distribution and salesmanagement model,” Tumbo said.
Last year, at the release of thefirm’s Half Year financial results, Tumbo who was recently appointed as theGroup CEO, confirmed that the firm had kicked off a strategic business recoverystrategy.
“It will no longer be business asusual. We have adopted a revised business model and we will be pursuing keyinitiatives geared at elevating the business back on a profitability path,”Tumbo had said.
The firm, he disclosed has alreadymade positive strides focusing on improved governance and leadership throughthe application of best practice corporate governance principles and retentionof an experienced talent pool including senior management team members.
According to the Insurance Regulatory Authority (IRA) Insurance Industry Release Report for Quarter 3 2018, long term insurance business in Q3 2018 experienced a growth of 3.9% compared to a growth of 16.9% recorded in the previous year during the same period. The long term insurers’ including Sanlam Life Insurance’s asset base grew by 11.9% to KES 380.40 billion and largely composed of income generating investments to the tune of KES 343.53 billion with total assets of KES 44.48 billion funded by shareholders through paid up capital and shareholders’ equity.
Within the same period, general insurance premiums recorded a marginal growth of 1.7% compared to a growth of 7.2% recorded in the previous year. The general insurance business underwriters incurred KES 43.88 billion in claims as at end of Q3 2018.