Motor vehicle importers in Kenya are raising alarms over a new directive set to take effect on February 14, 2025, which mandates that all importers secure local marine cargo insurance before their goods can clear customs.
Issued by the Insurance Regulatory Authority (IRA) and the Kenya Revenue Authority (KRA), the policy aims to streamline the insurance process but has sparked significant concerns within the importation industry.
Under the new rules, importers will be required to obtain marine cargo insurance from licensed Kenyan insurers, with certificates processed digitally through platforms connected to IRA and KRA systems.
These certificates will be accessible via mobile apps, web portals, and other online platforms provided by insurance companies, promising a more efficient and streamlined process.
However, motor vehicle importers argue that the directive contradicts established international trade conventions.
Traditionally, importers have relied on international insurers to cover the goods during transit, and they contend that forcing them to purchase local insurance could dramatically increase costs.
The new requirement may add extra financial burden on businesses, which already face high operational costs, as it would mean paying for insurance that overlaps with existing coverage from international insurers.
Beyond the financial concerns, the directive is also seen as a potential logistical headache.
Importers fear that the new policy could create delays at ports as they navigate the extra layer of bureaucracy required to secure local insurance certificates.
Some worry that the government’s move may disrupt long-standing relationships with their global insurance providers, creating further inefficiencies in the importation process.
Importers also point out the lack of consultation with key industry stakeholders prior to the announcement of the directive, leaving many questioning the rationale behind the move.
They argue that a more collaborative approach could have led to a more balanced policy, one that considers the complexities of international trade and the realities of the Kenyan market.
As the February 14 deadline approaches, industry players are hoping that the government will take their concerns into account and delay the implementation of the directive or offer more flexible solutions.
The decision will have profound implications not only for motor vehicle importers but for the broader importation sector in Kenya, influencing the future of trade and insurance practices in the country.
The outcome of this dispute could shape Kenya’s import policies for years to come, making the next few weeks crucial in determining the future landscape of the country’s trade industry.
