IMPACT OF ICT ADOPTION ON PERFORMANCE IN INSURANCE FIRMS IN KENYA
ICT is used in virtually every department of any organization today. We are living in a
technologically driven world. In a technology driven society, getting information quickly is
important for both sender and receiver. ICTs have made it possible to quickly find and distribute
information that is fundamental for decision making. For most organizations, adoption of at least an
information system is critical for performing day to day operations. Some service industries could
not operate without ICT. The ability of a firm to use ICT is becoming intertwined with the firm's
ability to implement corporate strategy. This means that there is interdependence between a firms’
ICT and its business capabilities. Often, what the organization would like to do depends on what its
ICT systems will permit it to do. Key drivers for investment and adoption of ICT include operational
effectiveness, competitive advantage, customer and supplier intimacy, improved decision making,
cost reduction, survival and improve control of the business. In developed first world countries,
insurance and banking are the leading service industries. In Africa and Kenya in particular, they are
lagging behind. Adoption and use of ICT has driven the growth and performance of insurance firms
in developed nations and this study is focused on determining whether ICT can have the same
impact here in Kenya. The study specifically sought to address the drivers for ICT adoption, the
extent of use and impact of ICT on performance in insurance companies in Kenya. To achieve this
objectives, and primary and secondary data was used. Primary data was collected through the use
of a self-administered questionnaire while secondary data was extracted from AKI reports of year
2012 and 2013. Senior ICT personnel from 30 insurance companies were interviewed. It was
established that there are many drivers for adoption of ICT and they vary from company to
company. On a whole, it was established that ICT systems are critical to insurance firms and are
especially used to manage the core business of premium collection and claims payments. It was also
determined that ICT adoption and extent of use does have an impact on a firm’s performance.