Kenya’s insurance industry is watching an unprecedented drama unfold at Directline Assurance, where a shareholder battle has spilled into the open and left thousands of policyholders wondering who is really in charge.
Media mogul S.K. Macharia, one of Directline’s biggest shareholders, stunned the market by announcing an abrupt shutdown of the motor insurer.
He attempted to transfer key assets to a third party while firing senior executives and installing his own team—moves that threw the company into turmoil overnight.
IRA Fights Back
The Insurance Regulatory Authority (IRA) swiftly rejected the purported closure and asset transfers, calling them null and void.
Only the regulator, it said, can suspend or cancel an insurer’s operations.
IRA reassured customers that all existing policies remain valid, claims will be honoured, and placed Directline under “close supervision” to safeguard policyholders’ interests.
Crisis of Authority
Yet the clash between Macharia’s power play and IRA’s regulatory veto has created a vacuum of clarity.
Competing announcements about Directline’s leadership and future have left employees, agents and policyholders confused. The firm has scrambled to issue its own statements promising business as usual.
IRA Blamed
While IRA insists it is protecting consumers, critics argue that its own actions—or lack of them—have fuelled the chaos.
Delayed enforcement: By moving slowly to impose penalties or settle the dispute, the regulator has allowed warring factions to issue conflicting directives.
Mixed messaging: IRA’s reassurances that policies remain valid without clarifying who is legally in charge leave stakeholders in limbo.
Corporate Brawl
Failure to pre-empt: Observers say an earlier, decisive freeze on contested asset transfers or board changes could have stopped the corporate brawl from escalating.
What began as an internal shareholder dispute has morphed into a test of Kenya’s insurance regulator.
How IRA navigates the next steps will determine whether Directline’s turmoil becomes a cautionary tale—or a permanent black mark on the industry’s credibility.
Eyes on IRA boss Godfrey Kiptum to give directions on a win-win between the two warring factions.
