Insurers rejected 6,591 claims worth Sh485.6 million in the three-month period to December last year, marking an over two-fold hike from the previous quarter where 1,904 claims were rejected, data from the Insurance Regulatory Authority (IRA) shows.

Most of them were in the medical and motor sectors and were attributed to fraud and delayed filing.

Claims declined are defined by IRA as requests that an insurer has vetoed for various reasons relating to the policy document or otherwise.

“In Q4 2022, liability and non-liability declined claims were 53 claims amounting to Sh33.38 million and 6,365 claims amounting to Sh226.53 million respectively. Long-term declined claims were 173 amounting to Sh225.71 million,” said IRA in its Q4 2022 Claims Report.

Insurers have in the recent past decried increasing cases of fraud that have bedevilled the sector, with motor operators making claims on fictional accidents and signing multiple insurance contracts on a single vehicle.

Other motorists have also been found to deceive insurers by deploying their vehicles for different activities from those insured against which translates to higher exposure risks.

Last year, IRA reported that malpractices that included false motor accident claims, stealing by agents, conspiracy to defraud and fraudulent motor theft claims were inflating insurance premiums in the country by up to 25 percent.

The adoption of technology and the attendant digitisation of the sector is however occasioning a shift by minimising fraud cases through the boost of accountability.

During the quarter under review, insurance companies paid out claims worth Sh40.6 billion, with general liability and non-liability claims taking Sh4.2 billion and Sh17 billion respectively.