Photo: Bahnfrend, Wikimedia Commons, CC BY-SA 4.0Insurance premium financing (IPF) in Kenya
How paying your premium in instalments works
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Why the premium must be paid before you are covered
Section 156 of the Insurance Act, Cap. 487, headed "Advance payment of premiums", is the rule often called "cash and carry":
- s.156(1): "No insurer shall assume a risk in Kenya in respect of insurance business unless and until the premium payable thereon is received by the insurer."
- s.156(2): "An intermediary shall not receive any premiums on behalf of an insurer." An intermediary who does so faces a penalty of 20% of the unremitted premium (s.156(3)).
So a policy only starts once the insurer has the money. For a car, that is when the digital certificate is issued — check it on DMVIC once you have paid (how to check a motor certificate). If a full year's premium is too much at once, there are two routes: a premium finance loan that pays the insurer for you, or an instalment plan offered by the insurer itself.
How an IPF loan works
- You choose the cover and get the insurer's quote for the full annual premium.
- You apply for IPF with a bank, a bancassurance intermediary or a premium finance provider.
- The lender pays the full premium to the insurer, which issues the policy and certificate.
- You repay the lender in instalments, with whatever interest and fees your agreement sets.
What the policy covers does not change: it is the same policy as if you had paid cash. What changes is who you owe money to — the lender, not the insurer — and the total you pay, which includes the cost of the loan.
What two IPF lenders publish
Their own documents (Equity's leaflet seen 28 October 2026; I&M's page, which blocks automated access, read from its Web Archive copy of 8 July 2025):
| Point | Equity (Equity Bancassurance Intermediary) | I&M Bank |
|---|---|---|
| Share of premium financed | "100% financing of the premium" | "100% finance on applicable insurance premiums" |
| Repayment period | Medical premiums 6 months; non-medical 10 months | "Up to 10 months" |
| Maximum amount | Not stated | Up to KES 300,000 |
| Covers financed | Medical and non-medical (motor, Biashara, agriculture, home, fire and perils) | General insurance policies placed or renewed for one year, e.g. motor, contractors' all risks, professional indemnity, medical; excludes life insurance |
| Security | "No security is needed" | Not stated |
| Who can apply | Individuals, traders, institutions, limited companies who get insurance through Equity | I&M account holders and non-account holders |
| Documents | Application form; ID and PIN certificate (individuals); CR12 and company resolution (companies) | National ID and PIN (individuals); certificate of incorporation or registration (businesses) |
| Interest rate | Not published | Not published ("No hidden charges and commitment fees") |
Sources: Equity's IPF leaflet and I&M's IPF page. Equity's leaflet says Equity Bancassurance Intermediary is regulated by IRA. This is not a ranking of lenders; other banks and brokers offer IPF on their own terms.
Instalments offered by the insurer itself
Some insurers spread the premium themselves, or arrange IPF for their customers:
- Britam MotiFlex spreads a comprehensive motor premium over 12 months in monthly, quarterly or semi-annual instalments — details in our Britam comprehensive car insurance article, from Britam's MotiFlex page.
- CIC Seniors Mediplan: CIC says the premium is "paid in full before cover commencement" and that "IPF is available – maximum of 4 instalments" (CIC Health Solutions page); see our CIC medical cover article.
- SHA is not an insurance premium: non-salaried members can spread their annual contribution with Lipa SHA Pole Pole — see how to pay SHA.
Before you sign an IPF agreement
- The total cost: ask for the interest rate, any arrangement or processing fee and the total amount you will repay, in shillings, and compare it with the cash premium.
- The instalment dates and how you pay (standing order, M-PESA, deduction from a bank account).
- What happens if you miss an instalment: read whether the lender can ask the insurer to cancel the policy and what refund, if any, goes to the lender. Driving on a cancelled motor policy means driving uninsured — see our Cap. 405 guide.
- Who the lender pays: the premium should go to the insurer named on your policy. Remember s.156(2): an agent or broker may not collect premiums on the insurer's behalf.
- Is the lender or intermediary registered? Check intermediaries on IRA's register — our article on checking if insurance is valid shows how.
Premiums for life, education and health policies can earn income tax relief — see our insurance relief guide — but interest paid to an IPF lender is a loan cost, not a premium.
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Frequently asked questions
What is IPF in insurance?
Insurance premium financing: a short-term loan that pays the full premium to the insurer so your cover can start, which you repay to the lender in instalments, usually over 6 to 10 months.
Why can't I pay my insurance premium in instalments directly?
Section 156(1) of the Insurance Act bars an insurer from taking on a risk until the premium is received. Some insurers run their own instalment plans (such as Britam MotiFlex); otherwise a premium finance loan pays the insurer for you.
How long is the repayment period for IPF?
Equity's leaflet says 6 months for medical premiums and 10 months for other insurance; I&M Bank says up to 10 months.
Can I get IPF for life insurance?
I&M Bank says its IPF works for one-year general insurance policies and excludes life insurance. Ask each lender which classes it finances.
What is the interest rate on insurance premium financing?
Neither Equity nor I&M publishes a rate on the pages we read. Ask for the interest, fees and the total amount repayable in writing before you sign.
Sources
- Insurance Act, Cap. 487 (Rev. 2022) — s.19 (only registered insurers), s.90 (non-forfeiture of life policies), s.150 (only registered intermediaries) and s.156 (advance payment of premiums)
- Equity Bancassurance Intermediary — Insurance Premium Financing leaflet (intermediary's own document, seen 28 October 2026)
- I&M Bank Kenya — Insurance Premium Financing page (bank's own page, Web Archive copy of 8 July 2025)
- Britam — MotiFlex page: comprehensive motor premium paid in instalments (insurer's own page, seen October 2026)
- CIC Insurance Group Kenya — Health Solutions page: Medisure and Seniors Mediplan, limits, eligibility, waiting periods, instalments (insurer's own page, seen 28 October 2026)