Policyholders Compensation Fund -Kenya

The period of Statutory Management of Blueshield Insurance Co. Ltd has been extended for a further period of thirty (30) days effective 19th June, 2016.

http://www.pcfkenya.org/index.php/2015-04-21-09-51-07/2015-04-23-15-29-03/blue-shield-insurance-co-ltd

Policy Holders Compensation Fund - Blue Shield Insurance Co Ltd

What are the PCF Levy funds collected used for?

The fund collects contributions for the sole purpose of compensation of policyholders. However, the fund being an entity has operational needs. Therefore, 10% of the total contributions received are allocated to the administration of the fund. The balance of 90% is invested in Government Securities like Treasury Bills to earn interest.

PURSUANT to the application by the Commissioner of Insurance in exercise of his powers under section 67 C (2) of the Insurance Act, and to the Orders of the Court subsequently issued on 15th April, 2016, the period of Statutory Management of Standard
Assurance Company Limited (under statutory management) has been extended for a further period of forty (40) days effective
28th March, 2016.

http://www.pcfkenya.org/index.php/2015-04-21-09-51-07/2015-04-23-15-29-03/standard-assurance-kenya-ltd

Policy Holders Compensation Fund - Standard Assurance Kenya Ltd

Policyholders Compensation Fund appointed statutory manager of Concord Insurance Company Limited

http://www.pcfkenya.org/index.php/2015-04-21-09-51-07/2015-04-23-15-29-03/concord-insurance-company-ltd

Policy Holders Compensation Fund - Concord Insurance Company Ltd

Why should Policyholders pay the IRA levy? Insurance Companies should pay it.

The beneficiaries of the fund are policyholders and not the insurance companies. By contributing to the fund, the policyholders are meeting their statutory obligation of ensuring that they will be compensated should their insurer be declared insolvent.

Policyholders Compensation Fund appointed statutory manager of United Insurance Company Limited
http://www.pcfkenya.org/index.php/2015-04-21-09-51-07/2015-04-23-15-29-03/united-insurance-company-limited

Policy Holders Compensation Fund - United Insurance Company Limited

What are the funds collected used for?

The fund collects contributions for the sole purpose of compensation of policyholders. However, the fund being an entity has operational needs. Therefore, 10% of the total contributions received are allocated to the administration of the fund. The balance of 90% is invested in Government Securities like Treasury Bills to earn interest.

What is the relationship between the I.R.A and the PCF?

The IRA and the PCF are both stakeholders in the Insurance sector. However, IRA regulates and supervises the industry players while PCF compensates policyholders.
Both bodies have been established under the insurance act.
Both establishments are mandated to protect the interests of insurance policy holders and promote the development of the insurance sector.

Our Mission
To create confidence in the insurance industry through compensation to policyholders of a wound up insurer.

What is the duration taken to declare an insurance company insolvent?

There is no specific duration or time taken to declare an insurance company insolvent.
Before a company is declared insolvent, the IRA appoints a statutory manager to try and revive the company. The statutory manager will take over the company for a specified time period but depending on the circumstances of the work, can apply for an extension with the Authority.

In the event that the manager successfully revives the company, it will not be declared insolvent. Should the manager be unable to revive the company, they will through a report inform the IRA who will file for a winding up petition at the courts. The period for hearing such a petition can only be determined by the legal process.
It is thus difficult to quantify the duration it takes to declare an insurance company insolvent.