After COFEK moved to the High Court to sue the Insurance Regulatory Authority (IRA), National Treasury Cabinet Secretary, Policyholders Compensation Fund and 19 Insurance companies alleged to be operating with capital adequacy ratios, one of the companies has made an interesting response.
Xplico Insurance, believed to be owned by Raj Sahi, lawyer on record turned himself again to swear a supporting affidavit- quoting an unnamed legal officer from Xplico as his basis.
It will be interesting to see if the Judge will admit the contentious affidavit of P.G Gitau.
The other 18 insurance companies are representing by former Law Society of Kenya chairman Nelson Havi.
It has come to COFEK’s attention that majority of registered insurers are operating outside thresholds of provisions of the law thus badly exposing the unsuspecting consumers (policyholders).
According to our investigations, the Insurance Regulatory Authority (IRA) has continued to perform below the par on its’ mandate as spelt out in Sec. 3A(1)(a)(b)(h).
Specifically, we are aggrieved that the IRA has failed to ensure and demonstrate that provisions of Sec.3A(2)(b) of the Act on protection of the interests of the insurance policyholders and beneficiaries are upheld in a manner that can easily be verified.
In our considered opinion, any form of negotiated compliance and use of the offending words like ‘industry median (average)’ as a way to cover for non-performing insurers is unacceptable both within the law and legitimate consumer expectations as it defeats the cause for public interest and justice.
As a result of this, and contrary to provisions of Sec. 23 as read together with Sec 41(1) of the Insurance Act, Cap 487, it is clear that majority of the insurers do not meet the minimum capital adequacy ratios as specified within the Schedule. Information in our possession indicates that several insurers, brokers and other entities registered by the IRA are operating and even issuing purported policy covers without current license. That is a major risk.
It must be stopped. It must never be the norm but the exception. It is the same companies that are using every trick and excuse in the book to either cut and or delay due payments.