MEDICAL insurer Resolution Health has taken up general insurance business after exclusively handling medical coverage for ten years.
The company yesterday launched its general insurance business when it unveiled the work injury benefits, group personal accident cover and short term life insurance cover.
"It was in our strategic plan to do this by the year 2014. In November 2011 we got a notice from IRA (Insurance Regulatory Authority) reminding us of new requirements that we either convert into a broker or a general insurer and we chose to become a general insurer," said the company's CEO Peter Nduati.
Nduati said conversion into a general insurer had taken the company slightly longer because he as the majority shareholder with a 52 per cent stake had to reduce his stake in the firm as per the 25 per cent maximum stake rule per individual, as per IRA regulations.
Resolution Health's assets as at end of 2012 stood at Sh1.1 billion. As a general insurer, the firm said its targeting Sh180 million investment income in the first year of operation under the new scope.
Last October, another health insurer AAR which started in 1984 as medical and accident victims evacuation firm also converted to a general insurer.
Medical class has been a thorn in the flesh for the industry registering the highest loss ratio compared to other classes of insurance business.
The latest full year data available which covers year 2011, shows a loss of Sh650.3 million during that year and a loss ratio of 84 per cent for the medical class. The loss ratio has been increasing every year.