Local insurers to gain as mandatory digital marine cargo cover takes effect
Kenya’s mandatory digital marine cargo insurance policy has taken effect, marking a significant shift in the country’s insurance landscape. Effective July 2, 2026, all imports entering Kenya must be insured through locally licensed insurance companies before customs clearance, a move designed to retain billions of shillings in premiums within the domestic economy.
The policy, which replaces the long-standing practice of sourcing marine cargo insurance from foreign underwriters, is expected to redirect an estimated Sh8 billion to Sh15 billion annually in premiums to Kenyan insurers. Previously, more than 85% of these premiums flowed to international companies, leaving local firms with a marginal share of the market. This exodus of funds has historically limited the growth of Kenya’s insurance sector, constraining its ability to invest in infrastructure, technology, and talent development. By retaining premiums domestically, the reform aims to build a more resilient and competitive local insurance market capable of meeting international standards.
Central to the reform is the Digital Marine Cargo Insurance Platform (DMCI), a collaborative initiative involving the Insurance Regulatory Authority (IRA), Kenya Revenue Authority (KRA), eCitizen, and participating insurers including APA General Insurance Company, Britam General Insurance, CIC General Insurance, Old Mutual General Insurance, Pacis Insurance, and Dynamique Insurance. The platform integrates with Kenya’s Integrated Customs Management System (ICMS) and M-Pesa payment services to enable real-time verification of insurance coverage and instant issuance of digital certificates. By automating verification and payment processes, the system reduces administrative burdens and enhances transparency across the import logistics chain. The platform also connects with eCitizen payment services, Pesaflow, and participating banks to facilitate seamless premium payments, further streamlining the import process.
Importers must now obtain a valid Import Declaration Form (IDF) to generate the digital Marine Cargo Insurance Certificate (DMIC) electronically. The certificate is verified automatically and transmitted directly to the Kenya Revenue Authority’s systems, eliminating manual processes and reducing opportunities for fraud. The Kenya International Freight and Warehousing Association (KIFWA) has rolled out the platform nationwide and is conducting a sensitization program to train clearing agents, importers, and other stakeholders on compliance procedures. Training sessions have been conducted in key border towns including Nairobi, Mombasa, Malaba, Busia, Namanga, and Isebania, with plans to continue outreach over the next 12 months. KIFWA has also committed to working closely with its insurance partners to provide technical support and ensure smooth implementation of the mandatory framework.
Government officials project that the reform will strengthen local underwriting capacity, enhance capital formation in the insurance sector, and support broader economic growth by retaining premium revenues domestically. The digitization of the process is also expected to improve compliance, accelerate cargo clearance, and mitigate fraud risks associated with paper-based certificates. Early indicators suggest that the system has already reduced clearance times at major ports, benefiting traders and logistics providers. By reducing reliance on manual verification, the system minimizes delays and enhances the predictability of supply chains for importers and exporters alike.
While the transition presents operational challenges for importers accustomed to foreign insurers, stakeholders emphasize that the long-term benefits include greater transparency, improved service delivery, and increased opportunities for local investment and employment in Kenya’s insurance industry. The initiative aligns with broader efforts to modernize Kenya’s financial services sector and increase regional competitiveness in the African insurance market. As Kenya positions itself as a hub for digital trade innovation, the marine cargo insurance reform serves as a model for how regulatory interventions can drive sectoral transformation and economic inclusion. Success will depend on sustained collaboration between regulators, industry players, and technology providers to address emerging challenges and ensure the system remains accessible and efficient for all stakeholders.
Image Source: GHANAMMA
