The Insurance (Market Conduct) Guidelines, 2022

LAWS OF KENYA
THE INSURANCE (MARKET CONDUCT) GUIDELINES, 2022
NO. 3642 OF 2022
Revised and published by the National Council for Law Reporting
with the authority of the Attorney-General as gazetted by the Government Printer
www.kenyalaw.org

published by the National Council for Law Reporting
with the authority of the Attorney-General as gazetted by the Government Printer
www.kenyalaw.org

Kenya
Insurance Act
The Insurance (Market Conduct) Guidelines, 2022
Gazette Notice 3642 of 2022
Legislation as at 29 March 2022
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Share widely and freely.

the creator.
• NC: Only noncommercial uses of the work are permitted.
• SA: Adaptations must be shared under the same terms.
Share widely and freely.

The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022)
Contents
STATEMENT OF INTENT .................................................................................................................................................................................... 1
1. Citation ................................................................................................................................................................................................................ 1
2. Interpretation .................................................................................................................................................................................................... 1
3. Application ......................................................................................................................................................................................................... 1
4. Purpose ................................................................................................................................................................................................................ 1
5.

................................................................................................................................................. 1
5.

General Principles ........................................................................................................................................................................................... 2
6. Fair Treatment of Customers ...................................................................................................................................................................... 2
7. Information Disclosure .................................................................................................................................................................................. 3
8. Development and Marketing of Products Policy Servicing .............................................................................................................. 3
9. Intermediaries ................................................................................................................................................................................................... 4
10.

................................................................................................................................................ 4
10.

Service Providers ........................................................................................................................................................................................... 4
11. Reporting ......................................................................................................................................................................................................... 4
12. Enforcement .................................................................................................................................................................................................... 4

.................................................................................................................................................... 4

The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022) Kenya
INSURANCE ACT
THE INSURANCE (MARKET CONDUCT) GUIDELINES, 2022
GAZETTE NOTICE 3642 OF 2022
Published in Kenya Gazette Vol. CXXIV—No. 56 on 29 March 2022
Commenced on 29 March 2022
STATEMENT OF INTENT
THE Insurance (Market Conduct) Guidelines are made by the Insurance Regulatory Authority pursuant to
section 3A (1)(g) of the Insurance Act and are intended to strengthen public trust and consumer confidence in
the insurance sector through ensuring that the entity maintains high standards of integrity and fair dealing in
conduct of their business, exercises due care and act in a diligent manner in dealing with customers, promotes
products and services in a manner that is fair and not misleading, obtains sufficient information about the
customer to assess their insurance needs and treat confidential information as such and communicates relevant
and meaningful information in a timely and comprehensive manner to policyholders. 1. Citation
These Guidelines may be cited as the Insurance (Market Conduct) Guidelines, 2022. 2.

n a timely and comprehensive manner to policyholders. 1. Citation
These Guidelines may be cited as the Insurance (Market Conduct) Guidelines, 2022. 2.

Interpretation
In these Guidelines, unless the context otherwise requires—
“Act” means the Insurance Act;
“treating customers fairly” means an outcome based regulatory and supervisory approach designed to
ensure that a regulated entity delivers specific, clearly sets out fair outcomes for its customers;
“market conduct” means elements of regulation and supervision focusing on a regulated entity’s
behaviour including non-distortive and non-abusive business practices and information disclosures;
“conduct of business risk” means any action by a regulated entity that is detrimental to consumers of
insurance services and products or may lead to instability of the insurance industry in a way that does not
ensure fair treatment of customers;
“regulated entity” means persons registered under the Insurance Act; and
“service provider” refers to Risk Managers, Motor Assessors, Insurance Investigators, Loss Adjustors,
Insurance Surveyors;
3. Application
These Guidelines shall apply to regulated entities. 4.

, Motor Assessors, Insurance Investigators, Loss Adjustors,
Insurance Surveyors;
3. Application
These Guidelines shall apply to regulated entities. 4.

Purpose
The purpose of these Guidelines is—
(a) to promote public trust and consumer confidence in the insurance industry;
(b) to ensure that a regulated entity maintains high standards of integrity, exercises due care and act in
a diligent manner in dealing with customers;
1

to ensure that a regulated entity maintains high standards of integrity, exercises due care and act in
a diligent manner in dealing with customers;
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The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022) Kenya
(c) to ensure that a regulated entity markets and distributes products and services in a manner that is
fair and not misleading;
(d) to ensure that a regulated entity obtains sufficient information to conduct a needs assessment
on potential customers, the information is treated in a confidential manner and is used for the
intended purposes only; and
(e) to ensure that a regulated entity communicates relevant and meaningful information in a timely
and comprehensive manner to customers. 5. General Principles
(1) A regulated entity shall develop, document and implement a conduct risk framework. (2) The ultimate responsibility for fair treatment of customers shall rest with the board and
management of the entity. (3) A regulated entity shall make relevant policies and procedures publicly available, in particular the
claims handling, complaints handling and dispute resolution. (4) A regulated entity shall exercise due care, skill and diligence when dealing with customers. 6.

dling, complaints handling and dispute resolution. (4) A regulated entity shall exercise due care, skill and diligence when dealing with customers. 6.

Fair Treatment of Customers
(1) A regulated entity shall develop and implement policies and procedures for fair treatment of
customers, including taking appropriate measures to ensure that its employees, service providers
and intermediaries meet high standards of ethics and integrity. (2) Fair treatment of customers encompasses achieving outcomes which include—
(a) developing and marketing products in a way that pays due regard to the interests of
customers;
(b) providing customers with clear information before, during and post sale;
(c) ensuring that the product being offered is appropriate to a given customer’s needs and
interests;
(d) ensuring that any advice given is of high quality;
(e) dealing with customer complaints and disputes in a fair manner and timely provision of
feedback;
(f) protecting the confidentiality of information obtained from customers; and
(g) managing reasonable expectations of customers.

ovision of
feedback;
(f) protecting the confidentiality of information obtained from customers; and
(g) managing reasonable expectations of customers.

(3) A regulated entity shall ensure that the fair treatment of customers is entrenched in its culture and
shall—
(a) designing, implementing and monitoring adherence to policies and procedures aimed at
ensuring that treated fairly;
(b) designing of the business strategy taking into consideration fair treatment of customers;
(c) identifying, collecting and evaluating relevant information for monitoring fair treatment of
customers;
(d) establishing mechanisms and controls to ensure that all departures from policies and
procedures as well as all other situations that jeopardize the protection of the interests of
customers are promptly remedied; and
(e) training relevant staff to deliver appropriate outcomes in terms of fair treatment of
customers. 2

terests of
customers are promptly remedied; and
(e) training relevant staff to deliver appropriate outcomes in terms of fair treatment of
customers. 2

The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022) Kenya
(4) A regulated entity shall promote insurance products and services in a manner that is clear, fair and
not misleading. 7. Information Disclosure
(1) A regulated entity shall be responsible for provision of information that is accurate, clear and not
misleading not only to customers but also to other entities who may rely on this information in
providing advice to customers. (2) A regulated entity shall, if it subsequently becomes aware that the information provided is not
accurate and clear or is misleading, withdraw the information and notify any person that it knows
or deems to be relying on the information as soon as reasonably practicable. (3) A regulated entity shall ensure that the information disclosed is accurate in all material respects,
not misleading, easily understandable and available in writing or appropriate electronic means.

mation disclosed is accurate in all material respects,
not misleading, easily understandable and available in writing or appropriate electronic means.

(4) A regulated entity shall provide at a minimum the following information—
(a) features of the insurance product;
(b) benefits, costs and risks to the customer;
(c) rights and obligations of the parties involved;
(d) complaints handling procedures; and
(e) duty of customers to disclose material information. (5) A regulated entity shall—
(a) provide a customer with a full and fair account of the status of the policy regularly and at
least annually;
(b) assess the customer’s needs, before giving advice or concluding a contract;
(c) explain and document the basis on which a recommendation is made, particularly in the case
of complex products and products with an investment element;
(d) have appropriate policies and procedures to identify and manage conflicts of interest;
(e) identify and manage conduct of business risks arising out of outsourcing arrangements; and
(f) develop and implement policies and procedures for the protection of confidential
information on customers. 8.

out of outsourcing arrangements; and
(f) develop and implement policies and procedures for the protection of confidential
information on customers. 8.

Development and Marketing of Products Policy Servicing
(1) An insurer shall—
(a) take into account the interests of different types of customers when developing and
marketing insurance products;
(b) carry out a diligent review of the product in relation to its business model, the existing rules
and regulations as well as its risk management approach; and
(c) issue a policy document within 14 days after inception of cover. (2) An insurer shall—
(a) provide support to intermediaries to ensure that they understand the target market and thus
reduce the risk of mis-selling;
(b) ensure that agents undertake a refresher course as a requirement for renewal of license once
every three years; and
3

uce the risk of mis-selling;
(b) ensure that agents undertake a refresher course as a requirement for renewal of license once
every three years; and
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The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022) Kenya
(c) review the advice given by the agents to ascertain the quality of advice given and take any
necessary remedial measures. (3) An insurer shall ensure that their conduct risk framework policy servicing throughout the life cycle
of the product until all obligations under the policy have been discharged. 9.

their conduct risk framework policy servicing throughout the life cycle
of the product until all obligations under the policy have been discharged. 9.

Intermediaries
(1) An intermediary shall—
(a) disclose to the customer their role in the transaction and the relationship the intermediary
has with the insurer including the basis on which they are remunerated;
(b) quote terms exactly as provided by the insurer;
(c) ensure that where a proposal form is used, the form is completed and signed by the
customer;
(d) disclose and explain to the potential customers the terms and conditions of the policy;
(e) provide the customer with a prompt written confirmation that insurance has been effected;
(f) ensure that where the policy document is not provided together with the confirmation of
insurance cover, the policy document is issued within fourteen (14) days of inception of
cover;
(g) provide an acknowledgement note, at the time of delivery of the policy document, to be
signed and dated by the customer acknowledging receipt of the policy document; and
(h) at the point of sale, inform the customer on the consequences of surrendering a life policy. (2) The cooling off period shall commence on the date of receipt of the policy document by the
policyholder. 10.

uences of surrendering a life policy. (2) The cooling off period shall commence on the date of receipt of the policy document by the
policyholder. 10.

Service Providers
An insurance service provider shall—
(a) accurately disclose its role in any professional engagement;
(b) disclose to the insured, claimant or a third party the principal on whose behalf they are acting;
(c) only disclose information, pertaining to the insurer, insured or claimant acquired in the course of
engagement, to a third party, with the consent of the concerned party; and
(d) ensure that reports issued comply with all statutory requirements and meet the requisite
professional standards. 11. Reporting
An insurer shall, on a quarterly basis submit to the Authority a complaints management report. 12. Enforcement
Where the Authority determines non-compliance with the provisions of these Guidelines, it may take any
intervention prescribed in the Act including the following—
(a) direct the regulated entity to take appropriate remedial action;
(b) impose additional reporting requirements and monitoring;
(c) withdraw or impose conditions on the business license taking into account the nature of the breach;
4

ional reporting requirements and monitoring;
(c) withdraw or impose conditions on the business license taking into account the nature of the breach;
4

The Insurance (Market Conduct) Guidelines, 2022 (Gazette Notice 3642 of 2022) Kenya
(d) impose monetary penalties as provided for under the Act; and
(e) take any other action as may be deemed necessary.
5