Insurance industry urged to embrace AI to speed up claims processing, curb fraud

Minet Kenya CEO Sammy Muthui, Insurance Regulatory Authority market conduct director Anne Chelagat and Britam Insurance chief operations officer Leonard Chirchir during the inaugural Minet Kenya Claims Conference/ HANDOUT

This comes against the backdrop of increasing challenges around delayed claim settlements and cases of fraudulent claims, which continue to affect customer trust and operational efficiency across the sector.

According to data from the Insurance Regulatory Authority (IRA), the industry paid over Sh80 billion in claims in Q3 2025 alone, highlighting the critical role in supporting individuals and businesses in times of loss. 

However, delays in claims settlement and fraud-related losses remain key concerns, slowing down service delivery and increasing the cost of insurance. 

A total of 532 complaints were registered in Q3 2025 compared to 423 registered in Q2 2025. Of these, 82 per cent were related to general insurance, while 18 per cent  were made against long-term insurers.

Speaking during the inaugural Minet Kenya Claims Conference 2026, Minet Associate general manager risk solutions. Patrick Oromo said, “Today, paper is not a mandatory thing in the process of how claims are handled. Therefore, the speed of settlement, ease of processing information, ease of lodging and paying out a claim, is of utmost importance. AI is the future, not just for the insurance industry but also for individual customers”.  

From the conference, Industry stakeholders note that the claims environment is becoming more complex, driven by a combination of global and local factors such as climate-related disasters and geopolitical tensions, such as the recent events in the Middle East that are disrupting global supply chains and affecting areas such as marine insurance and commodity pricing. 

In addition, cyber incidents are on the rise, exposing insurers to new and evolving risks, while inflation continues to push up the cost of repairs and replacements.

In 2024, the Insurance Fraud Investigation Unit (IFIU) received reports and detected cases of insurance fraud totalling 183. The most frequent fraud cases in 2024 were fraudulent motor insurance claims and theft by insurance agents, with 87 (33.0%) and 47 (23.7%) cases, respectively.

According to the Communications Authority, at least 4.56 billion cyber threat incidents targeting Kenyan Organisations were recorded in Q3 2025, a 441.27% increase. 

These pressures are directly impacting how claims are handled, from assessment timelines to settlement speeds, and are forcing the industry to rethink traditional approaches to claims management.

In response, insurers are increasingly encouraged to adopt AI-driven tools, predictive analytics, satellite imagery, and digital claims platforms to improve efficiency. These technologies can help process claims faster, enhance accuracy in fraud detection, and improve transparency for policyholders.

IRA insights indicate that fraudulent claims account for a significant share of industry losses each year, with estimates suggesting fraud can contribute up to 10–15 per cent of total claims costs in certain segments.

The adoption of AI, hence, can help identify suspicious patterns early, reducing losses and protecting genuine policyholders.

At the same time, digital claims platforms can significantly reduce processing timelines by automating documentation, verification, and assessment processes, helping insurers move from weeks to much shorter turnaround periods.

However, according to Oromo, while technology is critical, it should complement, not replace, human judgment. 

“Claims management remains a people-centred function, often involving individuals and businesses recovering from loss”, he added. 

As such, the most effective approach will be one that combines advanced technology with human expertise, empathy, and fairness to deliver a more efficient and responsive claims experience.

Participants further reaffirmed the industry’s shared commitment to working closely together, with the Insurance Regulatory Authority (IRA) fronting operational tools to ensure that sector growth translates into improved customer outcomes.

“We have developed a Treating Customers Fairly framework that provides a clear pathway for how customers should be treated throughout their journey, from onboarding to the point of making a claim,” IRA market conduct director, Anne Chelagat, said. 

“We are now placing greater focus on market conduct by becoming more proactive rather than reactive. This includes reassessing the relationship between insurers and their customers from the outset, as well as how both parties conduct themselves, to ensure that when a claim arises, due process is followed and the customer is treated fairly.”