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Curfew: IRA assures on motor insurance covers

By Steve Umidha
Thursday, April 1st, 2021
A police officer confronts a man when implementing the curfew. Photo/File
In summary
    • Any motor insurance claim that arises during curfew hours cannot be dismissed on the basis of the time of accident…however, should there be other circumstances excluded from the motor insurance policy the claim can be denied in those circumstances.
    • Insurance sector regulator said the principle behind standardisation of insurance policies which came into force in 2012, was to protect interests of policyholders and all stakeholders of the industry in promoting consumer confidence and increasing insurance penetration.
    • At the end of last week, Association of Kenya Professional Insurance Agents – insurance companies, agencies and brokers – warned the insured against driving past curfew hours if they are not listed as essential service providers, or if anything happens they will be on their own.

Steve Umidha @UmidhaSteve

Association of Kenya Insurers (AKI) and Insurance Regulatory Authority (IRA) have distanced themselves from the controversial statement on motor vehicle insurance coverage for motorists driving within curfew hours.

Association of Kenya Professional Insurance Agents (AKPIA) which comprises insurance companies, agencies and brokers, had threatened to halt claim settlements out of incidences occurring between 8pm and 4am, the hours, the government has barred movement under ongoing Covid-19 restrictions.

“Driving past curfew hours without essential services authorisation or valid emergency reasons could render your motor insurance claim invalid. Please avoid driving past 8pm curfew hours and adhere to all other GOK/MOH Covid-19 guidelines,” the association said in a bizarre public notice on Sunday, sparking public outrage.

It further asked those insured to contact their companies, agents and brokers they have taken cover with to get clarification, a position the insurance regulator held was illegal and a breach of contract to those holding such covers.

The notice set the ground for controversies between insurance service providers and the insured against how claims resulting from incidences occurring within curfew hours would be handled, how the insurers define “emergency reasons” and what insurance contracts state.

Clients premiums

Other members of the public have questioned the association’s move, wondering whether the insurers are also ready to refund their clients premiums covering for the curfew hours and amend contracts with their clients.

However,  IRA said in a statement yesterday that as per the approved and standardised motor insurance policy documents, driving past and during curfew hours is not an exclusion in the current motor vehicle insurance covers. 

“As such, insurance companies cannot reject motor vehicle claims on the basis of timing,” Chief executive Godfrey Kiptum maintained.

He said that claims incurred during curfew hours are payable and that the authority had not been approached by any insurer to modify contract terms of such indemnities.

“The Authority has not received any request to vary the general terms and conditions of motor insurance contract documents to include curfew requirements.

Consequently, payment of any motor claims is subject to the existing contracts between the insurers (policyholders) and insurers (insurance companies),” he noted in a virtual meeting with journalists.

Tom Gichuhi, AKI’s chief executive, also questioned the timing of the move, terming it “illegitimate and misleading.”

“We have made our position clear on the matter. This is not right and it is a misleading notice to the public.

We held a joint meeting on Tuesday with our colleagues and other stakeholders of the matter and certain decisions were made and a statement will be shared,” he said in a telephone interview.

“Any motor insurance claim that arises during curfew hours cannot be dismissed on the basis of the time of accident…however, should there be other circumstances excluded from the motor insurance policy the claim can be denied in those circumstances,” a statement released by AKI on the matter said.

Containment measures

By law, insurance companies are not charged with enforcing the Covid-19 containment measures but are guided by recent standardisation of the motor insurance class.

The sector regulator said the principle behind standardisation of insurance policies which came into force in 2012, was to protect interests of policyholders and all stakeholders of the industry in promoting consumer confidence and increasing insurance penetration.

IRA’s unaudited figures show that industry’s premiums grew by 1.8 per cent in the first quarter of 2021 at a time the regulator is also seeking to review the current premium rates.

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