Kenya’s Insurance Professionals Act 2025: Raising Standards, Building Trust, Protecting Consumers
- Muhoro & Gitonga Associates
- Sep 11
- 7 min read
Updated: Oct 7
Table of Contents
Introduction
What is the Insurance Professionals Act 2025?
Why Was the Act Needed?
Key Components of the Act
4.1. Regulatory Bodies Established
4.2. Licensing and Registration Requirements
4.3. Examinations & Certification
4.4. Continuous Professional Development (CPD)
4.5. Code of Conduct, Ethics and Disciplinary Mechanisms
Impacts of the Act on Industry Stakeholders
5.1. Insurance Agents & Brokers
5.2. Insurers and Underwriters
5.3. Consumers
5.4. Regulators & Training Institutions
Compliance Challenges and Practical Solutions
Comparative Perspectives: Global Best Practices
What Happens If You Don’t Comply?
Looking Ahead: The Future of Kenya’s Insurance Sector
10. Conclusion
11. Frequently Asked Questions (FAQ)
1. Introduction
The Insurance Professionals Act 2025 marks a transformative shift in the regulation of Kenya’s insurance sector. Designed to professionalize the industry, this landmark law introduces a robust framework to ensure that individuals operating in insurance are qualified, competent, and accountable.
In a country where trust in insurance has long been a challenge, this legislation seeks to raise professional standards, eliminate unethical practices, and restore public confidence in insurance services. Whether you are an agent, underwriter, insurer, legal practitioner, or consumer, understanding the new law is critical to navigating the future of Kenya’s insurance landscape.
The Insurance Professionals Act 2025 is a Kenyan law that introduces strict regulatory controls for anyone engaging in the insurance profession. The Act mandates that all insurance practitioners must undergo formal training, pass standardized examinations, obtain a licence, and adhere to a code of professional ethics.
Beyond establishing qualifications, the law also creates oversight bodies to enforce discipline, maintain registers, conduct certification exams, and offer continuous professional development (CPD). Essentially, it ensures that every person involved in advising, selling, underwriting, or handling claims is properly vetted and held to high ethical standards.
3. Why Was the Act Needed?
Before this law came into effect, Kenya’s insurance industry was plagued by low consumer trust, widespread misinformation, and the activities of unregulated intermediaries. Many insurance agents and brokers operated informally, often with little training or accountability. This led to mis-sold policies, delayed claims, and fraudulent activity.
With insurance penetration rates in Kenya hovering at low levels compared to global and regional averages, there was an urgent need to create a professional, trustworthy, and consumer-focused insurance environment. The Act addresses these issues by setting minimum competency thresholds and formalizing the role of every insurance professional.
4. Key Components of the Act
4.1 Regulatory Bodies Established
To implement and oversee the new legal framework, the Act establishes three key institutions:
The Insurance Institute of Kenya (IIK) becomes a statutory body responsible for setting standards, registering professionals, and managing CPD requirements.
The Insurance Professionals Examinations Board is tasked with designing and administering industry exams to certify competence.
The Registration of Insurance Professionals Committee maintains the national register of licensed practitioners and handles the issuance of practising certificates.
These bodies work in tandem to ensure only qualified, ethical individuals serve in the sector.
4.2 Licensing and Registration Requirements
Under the new law, anyone who engages in core insurance roles, whether as an agent, broker, claims handler, underwriter, or risk advisor, must be licensed. This involves registering with the relevant body, submitting educational and professional credentials, and obtaining a valid practising certificate.
The Act emphasizes that no individual or firm may operate in insurance without complying with these requirements, making licensing and registration not just a formality, but a legal necessity.
4.3 Examinations & Certification
Before being licensed, professionals must pass a certification exam administered by the Examinations Board. These exams test an individual's understanding of insurance principles, laws, ethics, and professional standards.
Certification ensures that professionals entering the industry have the knowledge and skills necessary to serve clients effectively and ethically. Without passing the required examinations, an individual is not eligible to receive a licence to operate in the insurance sector.
4.4 Continuous Professional Development (CPD)
To maintain their practising licences, insurance professionals must complete annual CPD requirements. These may include attending workshops, enrolling in courses, participating in seminars, or completing approved training modules.
CPD keeps professionals informed of changes in regulations, technology, emerging risks, and evolving consumer expectations. It is not just a checkbox requirement; it is a commitment to continuous learning and professional excellence.
4.5 Code of Conduct, Ethics, and Disciplinary Mechanisms
The Act outlines a clear code of conduct that all licensed professionals must follow. This includes honest communication with clients, avoiding conflicts of interest, transparent disclosure of policy terms, and ethical handling of claims and premiums.
A Disciplinary Committee has been empowered to handle complaints, investigate misconduct, and impose penalties such as fines, suspensions, or licence revocation. This adds a layer of accountability that has long been missing in the industry.
5. Impacts of the Act on Industry Stakeholders
5.1 Insurance Agents & Brokers
The new law brings legitimacy and recognition to the role of insurance intermediaries. Agents and brokers who comply with the regulations will benefit from enhanced trust, increased professional status, and potentially better earning opportunities.
However, those without the necessary qualifications or who fail to meet CPD requirements may find themselves excluded from the industry.
5.2 Insurers and Underwriters
Insurance companies must now ensure that their staff and affiliated agents are licensed and compliant with the law. This could increase operational oversight and training costs but will likely lead to better customer satisfaction and reduced legal risks.
5.3 Consumers
For consumers, the Act is a game changer. It guarantees that the person advising them on insurance is qualified and regulated. Consumers can expect more transparent services, better advice, and improved recourse in case of malpractice.
5.4 Regulators & Training Institutions
Regulatory and training institutions must scale up their capacity to deliver exams, manage registrations, and enforce compliance. This opens up opportunities for partnerships, digital training platforms, and expanded certification programmes.
6. Compliance Challenges and Practical Solutions
While the Insurance Professionals Act is a welcome development, it presents several practical challenges.
One major issue is the cost of compliance. Many small-time agents and brokers may find it difficult to afford certification exams or ongoing CPD courses. Solutions could include government subsidies, flexible payment options, or employer-sponsored training.
Lack of awareness is another hurdle. Some professionals may be unaware of the new requirements, which could lead to accidental non-compliance. Public education campaigns and industry briefings can help bridge this gap.
There is also geographic inaccessibility—professionals in rural or underserved regions may struggle to access training centres or exam venues. This can be mitigated through online learning platforms, virtual exams, and mobile training units.
Another potential challenge is resistance from informal practitioners, many of whom have operated for years without formal qualifications. Recognition of prior learning (RPL) schemes and transitional grace periods can offer a pathway for such individuals to meet the new standards without being excluded.
Finally, regulatory capacity must be addressed. As the number of applicants for registration and exams increases, the responsible bodies must scale up staffing, digitize processes, and implement robust systems to handle demand efficiently.
7. Comparative Perspectives: Global Best Practices
Internationally, most mature insurance markets require professionals to be licensed, undertake exams, and maintain CPD. Countries like South Africa, the UK, and Canada have long operated under similar regimes, which have resulted in more ethical, consumer-friendly insurance industries.
Kenya’s adoption of these global standards signals a commitment to positioning its insurance sector as competitive, trustworthy, and internationally respected.
8. What Happens If You Don’t Comply?
Failure to comply with the Insurance Professionals Act carries serious consequences. Practising without a valid licence can lead to legal penalties, including fines and possible imprisonment in severe cases. Non-compliant professionals risk losing clients, facing disciplinary action, and even being banned from the industry altogether.
Moreover, consumers and insurers may avoid dealing with unlicensed practitioners due to reputational and legal risks, further isolating non-compliant actors from the formal economy.
9. Looking Ahead: The Future of Kenya’s Insurance Sector
The full implementation of the Insurance Professionals Act is expected to usher in a more professional, consumer-focused, and trustworthy insurance ecosystem in Kenya. In the coming years, we can expect:
A rise in insurance penetration as public trust grows
More innovation in insurance training and certification
Enhanced digital platforms for licensing and CPD
Better dispute resolution and customer service standards
A new generation of highly skilled, ethical insurance professionals
The industry is set for a major upgrade, and early compliance will be key to long-term success.
10. Conclusion
Kenya’s Insurance Professionals Act 2025: Raising Standards, Building Trust, Protecting Consumers. The Insurance Professionals Act 2025 is not just a legal formality; it is a turning point. By formalizing qualifications, enforcing ethical standards, and introducing continuous learning, the law sets the foundation for a stronger, fairer, and more inclusive insurance industry.
For insurance professionals, the time to act is now. Embracing compliance, investing in training, and understanding your legal obligations is not only necessary but smart business. For consumers, the law brings renewed confidence that your insurance advisor is a true professional.
Kenya's insurance future just got brighter and more secure.
11. Frequently Asked Questions (FAQ) Kenya’s Insurance Professionals Act 2025: Raising Standards, Building Trust, Protecting Consumers
A: Anyone involved in providing insurance services such as agents, brokers, claims officers, and underwriters must comply with the Act.
Q: What are the main requirements to be licensed?
A: You must have recognized academic qualifications, pass a professional exam, register with the relevant authority, and obtain a practising certificate.
Q: What is Continuous Professional Development (CPD)?
A: CPD refers to ongoing training and learning activities that licensed professionals must complete every year to maintain their licence.
Q: Can I continue working if I don’t meet the new requirements?
A: No. It is illegal to practise without being licensed under the new regulations. You may face penalties or suspension.
Q: What happens to professionals already in the industry?
A: Existing practitioners are required to meet the new standards. However, transitional provisions may be in place, including recognition of prior learning.
Q: Are the exams difficult?
A: The exams are designed to test your knowledge of core insurance principles, ethics, and practice. Adequate preparation is essential.
Q: Is CPD mandatory for everyone?
A: Yes. All licensed professionals must complete CPD annually to maintain their practising certificate.
Q: How will consumers benefit from this Act?
A: Consumers will receive better, more ethical service from qualified professionals. They will also have more options for redress in case of disputes.
Q: Are training and exams available online?
A: Yes. The regulatory bodies are developing digital platforms for online training and exams, especially to support professionals in remote areas.
Q: Who enforces this law?
A: Regulatory bodies such as the Insurance Institute of Kenya, the Insurance Professionals Examinations Board, and the Registration Committee are tasked with enforcement.
To learn more, see the Insurance Professionals Act 2025.
