These policies provide cover for damage or loss to vehicles and vessels and the insured’s liability to third parties in respect of damage to property, bodily injury and death.
The motor vehicle is a 20th century phenomenon in Kenya. Motor vehicles belonging to white settlers started appearing on the Kenyan Roads after the first World War. A consequence of this phenomenon was the injury caused to people. A law was necessary to regulate the use of motor vehicles on the road, and compulsory motor insurance cover was effected in the country in 1946 when The Insurance (Motor Vehicle Third Party Risks) Act was first passed.
The levels of cover under motor insurance policies are as follows:
- Act only
Act only is the minimum cover required by The Insurance (Motor Vehicles Third Party Risks) Act 1989. It covers the insured’s legal liability as a result of third party bodily injury arising out of use of a motor vehicle on public roads. A third party is any person outside the insurance contract. Insurers seldom sell this cover.
- Third Party only
This covers the insured’s legal liability towards third parties in respect of death and bodily injury as well as property damage. This is the minimum motor insurance cover currently offered by insurance companies in Kenya.
- Third party, Fire and Theft
This covers the insured’s legal liability towards third parties in respect of death and bodily injury, property damage, and also loss or damage arising from fire or theft to the insured vehicle.
- Comprehensive Cover
The comprehensive insurance policy provides very wide cover. The term comprehensive is somehow misleading, however: though it implies that every conceivable risk is covered, this is not the case. It covers the insured’s legal liability towards third parties in respect of death and bodily injury and property damage and malicious damage to the insured vehicle. In other words, it covers all what is under third party, fire and theft as well as accident and malicious damage to the motor vehicle.
There are different types of motor vehicles as follows:
Private cars are covered under motor private policies. Their use is restricted to:
- social, domestic and pleasure purposes
- by the policy holder in person in connection with ones business and that of their employer’s business;
- other people with the authority of the policy holder.
A motor cycle is a mechanically propelled vehicle including mopeds and scooters. Although the undermining aspects are similar to those of motor private insurance there are some differences e.g, there are no additional benefits as given under the motor private insurance.
Commercial vehicles include all vehicles used for transporting goods and passengers for business purposes. This category of vehicles includes goods and passenger carrying vehicles like buses and taxis, motor trade, agriculture and forestry vehicles and special type vehicles like ambulances, hearses, fire brigade and construction vehicles. These are covered under a motor commercial policy.
Marine policies are issued to cover “perils of the sea”. These include fire, theft, collision and a wide range of other perils.
Marine policies issued relate to four areas of risk:
- the hull, that is, the vessel;
- the cargo, that is, the goods carried by the vessel;
- the freight, that is the sum paid for transporting goods or for the hire of the ship;
- Liability towards third parties
Most marine insurance in Kenya is for small craft and the rest are insured offshore.
Aviation policies are issued to cover the hull (the aircraft), liability to passengers, and liability to others. It provides cover for loss arising from fire, theft, accidents and legal liabilities.
Aviation insurance in Kenya is only limited to small aircraft. Large aircraft are insured with established markets in Europe. In Kenya most aviation policies are issued on an “all risk” basis, subject to some restrictions. The buyers of those policies are large commercial airlines, private owners and flying clubs. The covers given include:
- the hull (the aircraft)
- cargo (good carried)
- Liability to passengers
- Liability to others
LONG – TERM ASSURANCE
These are various types of long term insurance business products sold in the Kenyan market.