Excessive Court docket Suspends 50 P.c Improve in Automotive Insurance – Enterprise Each day

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High Court Suspends 50 Percent Increase in Car Insurance

Wednesday January 12, 2022

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BY SAM KIPLAGAT
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  • Judge James Makau said in a ruling that the problems raised in the petition give the Kenyan Commission on Human Rights a chance of success.
  • The judge also issued an order suspending a decision by insurance companies not to offer fully comprehensive insurance for vehicles that are more than 12 years old or have a value of less than 600,000 Shillings. exhibit.

The High Court has suspended the planned increase in car insurance premiums by up to 50 percent until a case filed by a lobby group has been decided.

Judge James Makau said in a ruling that the problems raised in the petition give the Kenyan Commission on Human Rights a chance of success.

The judge has also issued an order suspending a decision by insurance companies that do not offer comprehensive insurance coverage for motor vehicles that are more than 12 years old or have a value of less than 600,000 Shr. to have. The case is mentioned on February 14th.

“I have examined the petitioners' reasons in support of the request and the oral submissions of both parties after careful consideration.

The lobby group rushed to court last week, accusing the Insurance Regulatory Authority (IRA) of failing to protect the public and policyholders from such an increase.

KHRC's attorney Kelly Malenya said in court that a number of insurance companies had announced that they would increase their premiums for comprehensive motor vehicle insurance by up to 50 percent from January, which is illegal due to a lack of public participation.

He went on to say that some of the underwriters have announced that they will not offer full insurance coverage for vehicles over 12 years old or less than Sh600,000 in value.

The judge said it was likely that the public would be harmed if the proposed increase were not suspended, while the underwriters would not suffer if the order was issued. He also joined the Consumers Federation of Kenya (Cofek) as a prospect in the case.

The lobby group had submitted that the planned increase was discriminatory, unjustified and unlawful in view of the compulsory nature of motor vehicle insurance.

"The above actions are also a violation of consumer rights and are punitive, insensitive and oppressive," said Mr. Malenya.

Most insurance companies attribute the rise in premiums to an increase in claims, some of which are fraudulent.

But the commission said this was not a reason to increase premiums as the law provides guarantees that allow insurance companies to refuse claims that are fake.

*** Updated

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