The Directline Assurance Company, which controls up to 65 per cent of the Public Service Vehicles (PSV) insurance services in the country, has announced the suspension of its insurance activities.
In a statement, the insurance company revealed it had resolved to stop insurance operations on the grounds that the firm’s shareholders reached an agreement to cease conducting insurance business effective September 10, 2024.
Following the decision, Directline instructed the Association of Kenya Insurance Companies (AKI) to stop the issuance of any insurance certificates or stickers in its name.
Directline further noted that any company transactions would be made through its original shareholders as it accused CR12 of having fake shareholders.
Matatus at a terminal in Nairobi in August 18, 2024.
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Kenyans.co.ke/
CR12 is an official document issued by the registrar of companies in Kenya and contains a list of the company’s shareholders as well as their respective shareholdings.
According to Directline, the company was no longer under the regulation of the Insurance Regulatory Authority (IRA) as per the Insurance Act Cap 487.
Directline in its announcement also faulted IRA for permitting the issuance of the fraudulent CR12 despite being fully aware of the fraud dating back to 2005.
The company claimed that the shareholders listed in the CR12 are neither shareholders nor directors of the company.
The latest development comes hardly three months after Directline Company announced the decision to shut down.
In a notice issued on June 10 this year, SK Macharia, Chairperson of Royal Credit Limited, which owns the insurance company, announced the termination of all Directline’s employees.
Macharia also declared the immediate dissolution of the company’s Board of Directors, with Royal Credit Limited set to take over all assets owned by Directline.
However, Macharia’s move was stopped following the intervention of the Insurance Regulatory Authority which declared the Royal Media Services owner’s decision as null and void.
“All policies issued by Directline Assurance Company Limited remain in full force and effect and the insurer remains liable for any claims arising therefrom,” read part of a statement by IRA.
The Insurance Regulatory Authority signage.
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IRA
