common insurance mistakes in Kenya

For many Kenyans, 2025 was the year insurance stopped feeling straightforward. Premiums increased. Claims took longer. Some policies didn’t respond the way people expected. And for the first time, many policyholders felt caught off guard by conditions they didn’t realise existed.

But here’s the uncomfortable truth: a large number of insurance frustrations in 2025 were caused by avoidable mistakes. This article isn’t about pointing fingers. It’s about learning from a difficult year — and making smarter insurance decisions in 2026.

Why 2025 Exposed Insurance Mistakes More Than Ever

Insurance didn’t suddenly “break” in 2025. What changed is that claims increased across medical and motor insurance, insurers became stricter due to rising costs and fraud, and regulators demanded tighter controls and better governance.

In a tighter system, small mistakes had bigger consequences. What may have passed unnoticed in previous years suddenly led to rejected or delayed claims. That’s why 2025 felt harsh — and why lessons from this year matter.

Mistake #1: Buying Insurance Based on Price Alone

This was the most common mistake — and the most expensive one. Many people chose the cheapest policy available, assuming all insurance works the same way. In reality, price often reflects narrower coverage, lower limits, slower claims processes, and more exclusions. When claims happened, disappointment followed.

How to Avoid It in 2026

• Compare coverage, not just premiums
• Ask what is not covered
• Understand claim limits and excesses
• Remember: Cheap insurance is only cheap until you need it

Mistake #2: Not Reading or Understanding Policy Documents

Many policyholders relied on summaries, WhatsApp explanations, or assumptions. Then claims came — and so did surprises. Common misunderstandings involved exclusions, sub-limits, waiting periods, and claim procedures. Insurance contracts are detailed because risk is detailed.

How to Avoid It in 2026

• Read the policy schedule and key exclusions
• Ask questions before something goes wrong
• Request explanations in plain language
• Understanding your cover is part of protecting yourself

Mistake #3: Underinsuring Assets to Reduce Premiums

To save money, many people declared lower values for vehicles, business stock, equipment, and property. This led to underinsurance, where claims were paid proportionately — not fully.

What Many Didn’t Realise

If your asset is insured for half its value, you may receive only half of every claim, even for partial losses.

How to Avoid It in 2026

• Insure assets at realistic replacement values
• Review values annually
• Understand how average clauses work
• Saving on premiums can cost you far more during a claim

Mistake #4: Treating Insurance Like a Refund or Savings System

Many people expected insurance to refund every loss fully, regardless of size. But insurance is not designed to cover small, frequent losses, maintenance issues, or wear and tear. Insurance is about financial protection against significant, unexpected events.

How to Avoid It in 2026

• Use insurance for major risks
• Handle small expenses through savings
• Understand deductibles and excesses
• Insurance works best when paired with an emergency fund

Mistake #5: Poor Disclosure at the Proposal Stage

Some people left out information they thought was “minor”: past medical conditions, previous claims, business activities, or vehicle modifications. Unfortunately, insurance relies on full disclosure. Non-disclosure doesn’t usually show up immediately — it appears during claims.

How to Avoid It in 2026

• Be honest, even if it feels uncomfortable
• Ask what needs to be disclosed
• Remember: disclosure protects you
• A higher premium is better than a rejected claim

Mistake #6: Delaying Claims and Notifications

Many claims were weakened simply because they were reported late. This included motor accidents reported days later, medical claims submitted after deadlines, and property losses notified too late. Late reporting raises red flags and complicates verification.

How to Avoid It in 2026

• Report incidents immediately
• Keep insurer contact details accessible
• Follow claim procedures strictly
• Speed protects your claim

Mistake #7: Auto-Renewing Policies Without Review

Many people renewed policies automatically — without checking whether their needs had changed, values were still accurate, new exclusions had been added, or premiums reflected actual risk. In 2025, this led to shock renewals and unexpected gaps.

How to Avoid It in 2026

• Review policies at least once a year
• Adjust cover as life or business changes
• Ask what changed since the last renewal
• Insurance should evolve with your life

Mistake #8: Overlooking Liability Risks

Most people focused on protecting cars, health, and property but ignored liability risks, which are often far more expensive. Examples include third-party injury claims, professional negligence, and public liability incidents. Liability claims don’t damage assets — they drain finances.

How to Avoid It in 2026

• Understand your exposure to third-party risks
• Consider liability covers seriously
• Don’t assume “it won’t happen to me”
• Liability insurance is quiet — until it isn’t

Mistake #9: Assuming All Insurers Are the Same

In 2025, policyholders discovered that insurers differ significantly in claims handling, communication, financial strength, and policy wording. Choosing purely on brand familiarity or price often backfired.

How to Avoid It in 2026

• Consider reputation and claims record
• Ask about service standards
• Choose stability over shortcuts
• Insurance is a promise — and not all promises are equally kept

Mistake #10: Going It Alone Without Professional Advice

Many insurance issues weren’t caused by bad policies — but by lack of guidance. Without professional advice, people bought unsuitable cover, missed exclusions, and misunderstood claims processes. In a more complex insurance environment, guidance matters.

How to Avoid It in 2026

• Work with a qualified broker or advisor
• Ask questions regularly
• Treat insurance as a relationship, not a transaction
• Good advice often matters more than the policy itself

What 2025 Taught Us About Insurance in Kenya

The biggest lesson of 2025 is simple: Insurance is becoming stricter, not kinder. That doesn’t mean it’s failing. It means expectations must be realistic, decisions must be informed, and coverage must be intentional. Those who understood their insurance had far better outcomes than those who didn’t.

As highlighted in the Kenya Insurance Industry Report 2025, regulatory changes and market pressures have fundamentally altered how insurance operates in Kenya. The days of casual insurance purchases are over.

Turning 2025’s Mistakes Into 2026’s Protection

Mistakes are expensive — but they’re also powerful teachers. As we move into 2026, the goal isn’t to buy more insurance. It’s to buy better-structured, better-understood insurance.

When insurance is chosen thoughtfully, reviewed regularly, and used correctly, it still does what it’s meant to do: Protect you when life takes an unexpected turn.