Challenges in the adoption of Takaful Insurance in Kenya

Abstract

The study investigates the challenges in the adoption of Takaful insurance in Kenya. Takaful insurance was introduced in Kenya in the year 2011 when the regulator (IRA) approved licence for Takaful Insurance of Africa to start underwriting Takaful business. From its inception, Takaful insurance has been faced with numerous challenges that hinder its penetration and growth. The objectives of the study were to determine the challenges hindering adoption of Takaful insurance in Kenya and measurers to be adopted in overcoming these challenges. A descriptive survey design was used; data was collected from respondents using semi-structured questionnaires and data was analysed using content analysis. Tables and charts were used in presentation of data. From the findings it is clear that lack of public awareness and chronic shortage of human capital are the greatest factors that impede adoption of Takaful insurance within the Kenyan Market. The study recommends that Takaful operators, IRA and other stakeholder e.g AKI should embark on vigorous campaign to create awareness of existence of Takaful and remove the myth that Takaful insurance only belong to Muslim community. This will make the conservative public to be informed and make right decisions and choices with regard to their insurance needs. The study recommends further research on growth opportunities and emerging issues facing Takaful insurance in Kenya. This will provide an overall view on the issues that one needs to know when considering investing or adopting Takaful as a business model in the insurance industry.