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The East African : Oct 31st 2015
The EastAfrican OCTOBER 31-NOVEMBER 6, 2015 MARINE INSURANCE IN EA Urgent call to open sector to local firms He says if the gove≥nment intends to save the Ksh22 billion that is expo≥ted annually to fo≥eign fi≥ms, the≥e is a need to conside≥ the p≥ovisions of the p≥otocol with a view to p≥otecting local fi≥ms. “We need to look at the amount of money involved and find a way of opening some sections of the insu≥ance secto≥ while we p≥otect othe≥s. Remembe≥ impo≥ts a≥e inc≥easing as the ≥egional economies g≥ow, so it means this amount will keep ≥ising,” said M≥ Gichuhi. The othe≥ challenge is the low level of awa≥eness among impo≥te≥s which is being add≥essed by ISCOS and KMA in a pa≥tne≥ship that seeks to sensitize shippe≥s within the ≥egion on the app≥op≥iate use of inte≥national te≥ms of t≥ade, technically ≥efe≥≥ed to as INCOTERMS. When goods a≥e impo≥ted on CIF, it means the impo≥te≥ has no cont≥ol ove≥ the t≥anspo≥tation and insu≥ance se≥vices in the enti≥e logistical supply chain. It is the expo≥te≥ who decides which t≥anspo≥te≥ o≥ insu≥ance company to use. “The most se≥ious p≥oblem is that impo≥te≥s cannot be su≥e that insu≥ance was p≥ocu≥ed in the fi≥st place. Also, in case of a loss, the p≥ocedu≥e fo≥ p≥ocessing the claim is so cumbe≥some and tedious that small impo≥te≥s fo≥ego thei≥ claims,” M≥ Gichuhi said. Howeve≥, acco≥ding to IS- COS, legislation alone will not save the situation and conce≥ted e≠o≥ts a≥e ≥equi≥ed among indust≥y stakeholde≥s. “Even whe≥e legislation is in place, implementation still ≥emains a challenge. ISCOS ≥ecognises the info≥mation gap among shippe≥s and hence the e≠o≥ts to b≥idge it,” Alex Kanyama Zulu, Di≥ecto≥ of T≥ade Facilitation & Policy Ha≥monisation at ISCOS said in a ≥ecent inte≥view. Also, although the Insu≥- ance Regulato≥y Autho≥ity (IRA) is the indust≥y ≥egulato≥, it does not have any ≥ole in ca≥go expo≥t and impo≥te≥s have the f≥eedom to choose the ca≥≥ie≥ o≠e≥ing the most suitable te≥ms. Speaking du≥ing a council ministe≥s meeting in Mombasa ≥ecently, ISCOS sec≥eta≥y Gene≥al Kenneth Mwige asked impo≥te≥s to p≥ocu≥e insu≥ance locally instead of buying it f≥om fo≥eign companies, saying the amounts would ≥ise with inc≥easing volumes of ca≥go. Apa≥t f≥om saving the economy billions by using the co≥≥ect INCOTERMS, the≥e a≥e othe≥ benefits such as individual impo≥te≥s being able to negotiate fo≥ discounts on f≥eight and insu≥ance ≥ates given to ≥egula≥ and quantity of impo≥ts and expo≥ts. They also enjoy easy p≥ocessing of insu≥ance claims and f≥eedom the law “No insurer, broker, agent or other person shall directly or indirectly place any Kenya business other than re-insurance business with an insurer not registered under this Act without the prior approval, whether individually or generally, in writing of the commissioner.” to choose a ca≥≥ie≥ o≠e≥ing the most suitable te≥ms. Othe≥ benefits include f≥eedom to p≥ocu≥e the most suitable insu≥ance cove≥ fo≥ CIF expo≥ts and FOB impo≥ts the≥eby cont≥olling p≥emium cost and p≥ovision of all facts and an optimistic viewpoint of the ≥isk leading to a mo≥e ≥ealistic assessment of the p≥emium. Impo≥te≥s a≥e also assu≥ed that insu≥ance cove≥ fo≥ the financial ≥isk has actually been a≥≥anged and goods will not be held by t≥anspo≥te≥ fo≥ nonpayment of f≥eight. Othe≥ benefits include f≥ee- dom to change supplie≥ fo≥ FOB impo≥t without necessa≥ily cancelling the t≥anspo≥t cont≥act, without a≠ecting the impo≥t plan. Special advertising section 49 Containers with imported goods at the port in Mombasa. All importers are required by law to insure their goods.
Oct 24th 2015
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