In a move that is aimed at increasing public awareness, the Policyholders Compensation Fund (PCF) has intensified grassroots sensitisation forums with various groups to educate them about its’ mandate and functions.
The Fund’s Corporate Communications Deputy Director, Rosemary Kavili, says that PCF is keen on ensuring that Kenyans regardless of their location, understand how to seek redress from the agency without encountering barriers.
Speaking at the commencement of a five-day sensitization forum in Nyeri, Ms Kavili told journalists that the agency also wants to use the forums, which have been dubbed PCF Mtaani, to increase the public’s confidence in the insurance sector.
“Through PCF mtaani we are able to educate people on our mandate because we are majorly in Nairobi and nobody will hear us, nobody will see us, nobody will know the mandate that is bestowed on us as an agency by the government if we remain in the capital city,” she said during a journalists’ sensitization forum held at the Nyeri National Polytechnic on Tuesday.
Nyeri becomes the 14th county for PCF to pitch tent. During their stay, the fund is set to engage boda boda and matatu operators. They have also organised an engagement session with National Government Administration Officers, teachers’ unions; Kenya Union of Post Primary Education Teachers and the Kenya National Union of Teachers.
They are also scheduled to meet with special interest groups, religious groups, Kenya National Chamber of Commerce and Industry, farmers’ cooperatives and insurance agents who are the intermediaries between the clients and the insurance.
Ms Kavili said, among the topics that the participants will be sensitized on, is how to lodge claims for insurance compensation in the event that an insurer is placed under statutory management or the insurer’s license is cancelled.
She said that some of the reasons for collapse include poor governance practices, insurance fraud, and under-pricing of insurance products by setting premiums that are too low to cover the expected costs. Economic downturns and global shocks have also been cited as a reason for the collapse of insurance companies.
“There are about 20 listed collapsed insurers in the country, some dating back to the late 90s. We also have more recent cases like Resolution Insurance (2022), Xplico Insurance (2023) and Invesco which collapsed in 2024.We discovered that despite being in existence since the year 2005, people are not aware of what steps to take when such events occur while others do not know that they can actually pursue compensation,” noted Ms Kavili.
The fund’s asset base stands at Sh24 billion with the maximum compensation amount per claim being capped at Sh250,000. According to Ms Kavili, PCF commenced the process for compensating policy holders and claimants of insurers under statutory management or whose license has been cancelled, in the financial year 2020/2021.
A report by the fund shows that a total of 1,426 claims amounting to Sh240 million have been settled so far. The report shows that in the 2020/2021fiscal year the fund paid out some Sh5.6 million to 25 claimants while in the fiscal year 2021/2022 some Sh18.5 million to 91 claimants.
In the fiscal year 2022/2023 the fund paid out Sh65.9 million to 624 claimants and in the subsequent year, the fund made compensation to 44 claimants amounting to Sh8.5 million.
Over the last financial year, the PCF released Sh108 million to 494 claimants. During the current fiscal year, the fund has already disbursed Sh32.9 million to 148 claimants.
The report further shows that as at June 30 this year, the fund had managed to settle nearly half of the claims lodged to the fund for seven insurers under statutory management or liquidation.
Out of 896 claims regarding Resolution Insurance the fund had settled 767 claims amounting to Sh90.86 million. The fund has been able to settle all 45 claims relating to Concord Insurance amounting to Sh9.03million. Policyholders Compensation Fund has so far made compensations amounting to Sh4.63 million relating to Standard Assurance for 21 out of the 31 claims lodged.
The fund has also processed compensation valued at Sh14.44 million regarding 77 claimants from BlueShield Insurance. For United Insurance, the fund processed 6 claims valued at Sh 772,000.
Whereas 896 claims regarding Xplico were lodged, the fund made compensations amounting to Sh77.56 million concerning 342 claims. For the recently collapsed Invesco Assurance a total of 372 compensation claims were lodged but the fund made compensations for 185 claimants valued at Sh42.82 million.
Ms Kavili said that as the time frame for processing payment is two years, some of the biggest challenges the fund is hoping to address through PCF Mtaani will be enlightening the members of the public on the timelines and procedures to be followed when lodging a compensation claim.
By Wangari Mwangi and Samuel Maina
