Business Quest Team 
Stephen Lokonyo,Managing Director,First Assurance Kenya Ltd
First Assurance Investments Limited (FAI) has completed the acquisition of Absa Group’s controlling interests in two Kenyan insurers with combined assets of KSh33.54 billion and half-year net profit of KSh603.56 million, ending 11 years of ownership by the South African banking group.
- The transaction gives FAI, an existing shareholder, control of First Assurance Company Limited and Absa Life Assurance Kenya Limited through the acquisition of Absa’s entire shareholding in First Assurance Holdings Limited.
- The deal, reportedly valued at approximately KSh3 billion, was completed after regulatory approvals and customary conditions were satisfied,according to November 9 announcement.
- The companies did not disclose the final purchase consideration.
Their combined shareholders’ equity stood at KSh3.93 billion, against insurance contract liabilities of KSh27.76 billion.
Its gross premiums reached KSh6.78 billion, giving it a 4.59% share of Kenya’s long-term insurance market.
The insurer also held KSh21.96 billion in closing life funds, reflecting the scale of its policyholder-related obligations.
Its gross premiums totalled KSh3.80 billion, representing 2.68% of Kenya’s general insurance market.
However, the insurer recorded a KSh56.58 million loss in its traditional underwriting account, with claims pressure evident in motor commercial, fire industrial and engineering insurance.
Despite the underwriting loss,First Assurance remained profitable overall, supported by investment income and other components of its financial results.
Following the acquisition,Absa Life will be rebranded First Assurance Life, while First Assurance Company will operate as First Assurance General.
Both businesses will carry the designation “Formerly an Absa Group Company” for six months.
Existing insurance products and services will remain unaffected,while distribution agreements with Absa Bank Kenya will continue.
The arrangement allows the bank to retain its insurance distribution business without directly controlling the underwriting operations.
The transaction reverses Barclays Africa’s acquisition of a 63.32% controlling stake in First Assurance, effective October 30, 2015, for approximately KSh2.20 billion, alongside an additional capital commitment of roughly KSh700 million.
It also extends Absa’s withdrawal from insurance manufacturing in Africa following disposals in Botswana,Mozambique and Zambia in 2025, while returning control of the Kenyan businesses to an existing local shareholder.
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