Kenya's Insurance Regulatory Authority (IRA) has announced the placement of Xplico Insurance Company Limited under statutory management and the liquidation of Invesco Assurance Company Limited.
In an official press release issued on Friday, the IRA detailed the actions taken against the insurers, emphasizing the imperative to protect policyholders and maintain the integrity of the insurance sector.
Xplico Insurance Company Limited Placed Under Statutory Management:
Xplico Insurance Company Limited finds itself under Statutory Management, effective immediately.
The IRA, acting in accordance with the Insurance Act, has appointed the Policyholders Compensation Fund (PCF) as the Statutory Manager for Xplico.
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"The Insurance Regulatory Authority has today, as per Section 67C(2)(i) of the Insurance Act, placed Xplico Insurance Company Limited under Statutory Management. Consequently, the Authority has with immediate effect appointed the Policyholders Compensation Fund (PCF) as the Statutory Manager for Xplico Insurance Company Limited," IRA stated.
In compliance with the regulatory directive, Xplico is prohibited from issuing new insurance contracts from 8th December 2023.
Policyholders of Xplico are strongly advised to promptly seek alternative coverage from licensed insurers to mitigate any potential risks arising from the insurer's current status.
The Policyholders Compensation Fund will play a pivotal role in compensating affected claimants, ensuring adherence to the provisions outlined in the Insurance Act, CAP 487 Laws of Kenya.
Invesco Assurance Company Limited in Liquidation:
Concurrently, the IRA has received official communication from the Official Receiver regarding the appointment as the Provisional Liquidator of Invesco Assurance Company Limited.
This development stems from the insolvency cases of Dama Charo Nzai & 57 Others VS Invesco Assurance Company Limited (Malindi Insolvency Cause No. 1 of 2018) and Salesio Kinyua Njagi & 9 Others VS Invesco Assurance Company Limited (Nairobi Insolvency Petition No. E015 of 2019).
The Official Receiver has assumed control of Invesco Assurance Company Limited for the purpose of liquidation, leading to the cancellation of the insurer's license.
Similar to Xplico, Invesco is barred from issuing new insurance policies from 8th December 2023.
"At the same time, the Authority is in receipt of communication from the Official Receiver on his appointment as the Provisional Liquidator of Invesco Assurance Company Limited (the insurer) in Malindi Insolvency Cause No. 1 of 2018-Dama Charo Nzai & 57 Others VS Invesco Assurance Company Limited, and Nairobi Insolvency Petition No. E015 of 2019 Salesio Kinyua Njagi & 9 Others VS Invesco Assurance Company Limited," IRA statement said.
Existing policyholders are urged to swiftly secure alternative coverage from licensed insurers to avoid any unwarranted exposure.
The Policyholders Compensation Fund, a key player in safeguarding the interests of claimants, will step in to compensate those affected by the liquidation of Invesco Assurance Company Limited, adhering to the stipulations set forth in the Insurance Act, Cap 487 Laws of Kenya.
In taking these decisive actions, the Insurance Regulatory Authority aims to uphold the stability and trustworthiness of the insurance industry, assuring the public that regulatory measures are in place to safeguard the interests of policyholders.
The swift actions taken serve as a proactive measure to protect the public and ensure the orderly resolution of challenges within the sector.
