The regulatory landscape is changing…
By David Seagon
The Kenya rumour Mill has been in top gear in recent weeks, and I have been approached by several clients telling me they had heard JW Seagon were no longer working with Bupa Global.
I would like to reassure each and every one of you that the JW Seagon and Bupa Global relationship remains as strong as it was when we first started working together 30 years ago. JW Seagon is considered a key partner to Bupa in the region, and Bupa is still a major insurer for JW Seagon.
Recently we made some key changes to a certain product we designed and developed with Bupa Global and this may well have contributed to the rumours that are in the market at the moment. The product in question is a JW Seagon product, and Bupa was well aware of our decision, and understood why we were making the change.
We are governed more and more by local regulation in every country in which we operate, and for us to comply with regulation, and stay ahead of the game, changes are likely to happen.
Local Regulators are increasingly wanting to see the local insurance market protected and if cover is available locally then regulators want the insuring public to buy those covers locally. There are certain covers which cannot be 100% accommodated locally, with International medical cover being one of them; the high levels of benefit and the guaranteed renewal terms make it difficult for local insurers to offer the global support and assistance international medical insurers provide. As a result approvals are often given for International Medical insurers to operate in the country. In my view this will change in the short to medium term with the Regulator requesting International Insurers to team up with local insurers, and to set up “risk share” arrangements.
The budget last week reinforces this view, with a new tax resulting in additional cost for international insurers to operate in Kenya. With effect from 1st July, 5% Withholding Tax is being charged on insurance premiums paid to Non Resident Insurance companies. This applies to Bupa, AXA, Allianz etc. I have reached out to all our partners to find out how they will be managing this going forward, and I will update you further once I have had concrete feedback from them.
Considering all this it is my intention, and that of JW Seagon as a Group, to ensure we are ahead of the game and we are in a position to comply with all local requirements. As a result there may be additional changes we have to make as a group in the months ahead, but this is only with the long term benefit of our clients in mind.
It’s also worth noting that some International insurers have a much wider regulatory footprint in Africa, than others, thus enabling them to work in a compliant manner much more freely across the continent. Again, I will be discussing this in more detail in the near future, as the next stages of our own regulatory compliance is unveiled.
We will of course keep you up to date with any developments and notify you in advance should we need to make any changes to your policy. If anyone has anything they want to raise with me personally, please don’t hesitate to call me +254 722 514240.
Many thanks for your business.