Insurance regulator takes control of three insurance firms over financial troubles

The Insurance Regulatory Authority stated that the move is meant to protect policyholders and prevent the firms from taking on more risks as their financial positions continue to deteriorate. 

This means that Trident Insurance Company, KUSCCO Mutual Assurance Limited and Corporate Insurance Company are now under statutory management after determining that the three insurers were no longer meeting mandatory solvency requirements.

The regulator noted that the decision followed extensive supervisory engagement with the companies, during which their financial positions continued to deteriorate despite several regulatory interventions aimed at restoring compliance.

Under the move, the Policyholders Compensation Fund has taken over the management and operations of the three insurers effective March 11th.

The fund will now oversee the firms’ affairs, including assessing liabilities, verifying claims and managing the settlement of outstanding obligations in accordance with the law. 

The authority has also directed that the three affected insurers will not be allowed to enter into any new insurance contracts, while existing policyholders have been advised to seek alternative cover from other licensed insurers to avoid unnecessary exposure.

The regulator stated that the action is intended to safeguard the interests of policyholders, creditors and the wider public, while preventing further accumulation of risks within the affected companies.