The insurance industry investment rose 12.4 per cent in the first six months of the year to Sh450.67 billion from Sh400.83 billion in the same period in 2016, data from Insurance Regulatory Authority (IRA) shows.
The insurance industry mobilises savings and invests in government securities, deposits, capital markets and the real estate sector.
The IRA report shows that asset classes with the highest investment proportions were government securities (50.9 per cent), investment property (16.4 per cent), term deposits (9.6 per cent) and ordinary shares at 9.3 per cent.
In the general insurance business, underwriters put 5.7 per cent of their investment in subsidiaries, government securities took 40.4 per cent and investment in properties was at 24 per cent.
“Quoted ordinary shares took 6.7 per cent, unquoted ordinary shares (2.4 per cent), loan and mortgages (3.1 per cent), terms deposits (14.2 per cent) and other securities (3.4 per cent),” the IRA half year report shows.
In the long-term insurance business, the underwriters invested two per cent in subsidiaries, 56 per cent in government securities and 12.6 per cent in investment property.
“Quoted ordinary shares took 10.6 per cent, unquoted ordinary shares (1.7 per cent), loans and mortgages (2.6 per cent), terms deposits (7.3 per cent) and in other securities 7.2 per cent,” IRA said.
In 2016, the industry asset base grew by 10.4 per cent from Sh478.75 billion in 2015 to Sh528.75 billion. A large portion of the assets, 80.4 per cent, was held in income generating investments. These investments grew by nine per cent from Sh390.23 billion in 2015 to Sh425.30 billion at the end of 2016.