Kenya has strengthened its position as one of Africa's leading insurtech markets, attracting $66 million (Sh8.6 billion) in venture capital over the past five years as investors increasingly back startups seeking to close the continent's vast insurance protection gap.
A new report by AfricInvest shows Kenya ranked second only to South Africa in insurtech funding between 2021 and 2025, ahead of Nigeria, with Nairobi emerging as one of the continent's key innovation centres alongside Johannesburg and Lagos
The report says Africa's insurtech sector has entered an acceleration phase after attracting more than $300 million in funding over the last five years, with annual investment reaching a record $80.6 million in 2025. Kenya, South Africa, Nigeria and Egypt accounted for 86 percent of all funding during the period.
Kenya's growth has been driven by a supportive regulatory environment, including the Insurance Regulatory Authority's BimaLab innovation hub and BimaBox regulatory sandbox, which allow startups to test new products with customers.
The country's 2020 Microinsurance Regulations also permit digital distribution of microinsurance products through licensed insurers using mobile money and electronic policy documents.
Unlike South Africa, where startups primarily sell insurance directly to consumers, Kenyan firms have focused on embedded insurance models, partnering with banks, fintechs, microfinance institutions and telecommunications companies to distribute affordable health, agricultural and life insurance products.
Among the country's leading startups are agricultural insurer Pula, embedded insurance provider Turaco, healthcare payments platform CarePay and digital insurance marketplace mTek. Pula now operates in more than a dozen African countries, while Turaco has expanded across East and West Africa through partnerships with fintechs, lenders and telecom operators.
The report highlights Kenya's partnership-led model as particularly well suited to Africa's low insurance penetration. Fewer than two in ten Africans have health insurance despite at least six in ten having access to a bank or mobile money account, creating a significant opportunity for insurers that can embed cover into financial services people already use.
Mobile money has become a key advantage for Kenya. AfricInvest notes that partnerships between insurers and telecom firms such as Safaricom enable startups to sell insurance through existing payment rails, lowering customer acquisition costs while making products more accessible to low-income consumers.
The report also points to growing collaboration between established insurers and startups. Britam, through its microinsurance business Britam Connect, has expanded low-cost insurance for farmers, women and small businesses, while its BetaLab programme invests in early-stage insurtech, fintech and healthtech ventures.
Looking ahead, AfricInvest argues that Kenya is well placed to benefit as embedded insurance and artificial intelligence reshape the sector. The report says Africa could narrow its gap with Asia's more developed insurtech ecosystem thanks to widespread mobile money adoption, a young population and improving regulation, although fragmented markets across the continent remain a challenge to scaling businesses.
