The Insurance Regulatory Authority (IRA) has dismissed reports on the closure of Directline Assurance company, terming them illegal.
On Monday, Royal Credit Limited chairman SK Macharia announced immediate closure of Directline Assurance, dissolving its board and sending home all its employees of the company with the assets transferred to Royal Credit Limited.Macharia said the action was prompted by the closure of all Directline Insurance accounts by the Insurance Regulatory Authority (IRA) and failure by the insurance regulator to take action against directors of Directline for allegedly misappropriating KSh 7 billion.IRA said it has placed Directline Assurance under heightened surveillance and it will take necessary steps as may be appropriate, pursuant to the provisions of the Insurance Act, CAP 487 Laws of Kenya, to ensure sustainability of the insurer and protection of insurance policyholders’ interests.“The Insurance Regulatory Authority (the Authority) has taken note of communication released by Dr. S. K. Macharia through Royal Credit Limited regarding operations of Directline Assurance Company Limited (the insurer),” said Godfrey Kiptum, Chief Executive Officer IRA.
“The purported actions are null and devoid of any legal effect and as such the insurer continues in full operation as licensed and approved by the Authority,” he added.
In a statement, Kiptum said the purported transfer of the assets of the insurer to any third party is therefore null and void and all policies issued by Directline Assurance Company Limited remain in full force and effect and the insurer remains liable for any claims arising there from.
IRA said it has placed Directline Assurance under heightened surveillance and it will take necessary steps as may be appropriate, pursuant to the provisions of the Insurance Act, CAP 487 Laws of Kenya, to ensure sustainability of the insurer and protection of insurance policyholders’ interests.
See Also:
Xplico Insurance’s Statutory Manager Caps Compensation at KSh 250,000 Per Claim
