Kenya Reinsurance Corporation increased its investment in its Zambian subsidiary by Sh284 million last year, more than doubling its total capital in the unit to meet the revised capital requirements.
The reinsurer’s latest disclosures show the fresh capital increased the value of investment in the Zambian unit to Sh498.5 million in 2025 from Sh214.9 million a year earlier.
Kenya Re Group MD Hillary Wachinga told the Business Daily the reinsurer injected 50 million Zambian Kwacha (Sh284 million at the time of recapitalisation) to comply with the new requirements.
“The 50 million Kwacha was to meet regulatory requirements in line with Zambia’s Pensions and Insurance Authority,” Dr Wachinga said.
Zambia introduced the Insurance (General) Regulations, 2022 requiring insurers and reinsurers to maintain a capital adequacy ratio of at least 150 percent and set December 2025 as the deadline for compliance. Insurers and reinsurers were given three years to comply.
The rules replaced previous ones where licensees were only required to maintain a solvency margin of at least 10 percent, alongside flat minimum paid-up capital limits that were based on the type of business undertaken by an insurer or reinsurer.
A 150 percent capital adequacy ratio means an insurer or reinsurer must have Sh150 as readily available capital for every Sh100 of risk it carries. The buffer guarantees that if unexpected massive claims strike, a company has the financial muscles to pay clients without collapsing.
Kenya Re’s fresh capital, disclosed in the reinsurer’s latest annual report, signals a push to strengthen its position in the Zambian market where it operates a fully owned subsidiary. The Zambian subsidiary is turning 10 this year and earned Kenya Re Sh514.07 million last year.
The additional funds are expected to enhance underwriting capacity and support business expansion.
The capital injection came in the year Kenya Re set in motion plans for an office in India and establishment of a subsidiary in Tanzania.
Kenya Re also holds wholly owned subsidiaries in Côte d’Ivoire and Uganda, with investments of Sh1.96 billion and Sh584.2 million respectively, unchanged from last year.
Total investment in subsidiaries rose to Sh3.05 billion in 2025 from Sh2.76 billion in 2024.
“The primary business of the three subsidiaries is reinsurance. The head office injected additional capital to the Zambia subsidiary of Sh284 million,” said the reinsurer in the report.
The three subsidiaries and the plans for more reflect the company’s strategy to deepen its footprint across Africa amid evolving regulatory demands and rising competition in local markets.
The Cote d`Ivoire subsidiary started operating in 2015, followed by the Zambian unit in 2016 while the Uganda subsidiary began operating in January 2023.
“These subsidiaries remain pillars of the Group’s regional growth strategy and provide important geographical diversification,” Dr Wachinga said in the report.
Kenya Re, which is 60 percent owned by the Kenyan government, serves more than 80 markets through its head office in Kenya and the three subsidiaries.
The reinsurer is working on setting up a subsidiary in Tanzania and an office in India.
Last month, Kenya Re announced vacancies for the positions of CEO and chief finance officer in Dar es Salaam.
