Resolution Insurance Placed Under Statutory Management Over Unsettled Claims

The Insurance Regulatory Authority (IRA) has placed Resolution Insurance Company Limited under statutory management citing the company's inability to meet its obligations.

Through a statement, IRA stated that this decision comes after they have had numerous engagements with the company in an attempt to salvage the company but with no success.

"Despite the various intervention measures taken as provided for by the Insurance Act, Resolution Insurance Company Limited has continued to slide into operational and financial difficulties," the regulator said

In particular, IRA noted Resolution Insurance is not able to settle claims to the detriment of claimants, policyholders, and other creditors.

FurtherThe insurer is also not able to comply with statutory requirements relating to capital adequacy, submission of returns, and governance structures," noted IRA.

For these reasons, the authority explained that having considered the risks and consumer exposure posed by the company it was in the best interest of the public to have the company placed under management.

As of April 5, all existing policies ceased to exist and the Policyholders Compensation Fund (PCF) was appointed as the statutory manager of the company for a period of 12 months.

PCF has been instructed to compensate all claimants of the insurer with all claims payable capped at Ksh. 250,000