Lang'ata MP Jalang'o to table bill to end compulsory vehicle insurance cover

Lang'ata Member of Parliament Phelix 'Jalang'o' Odiwuor has announced plans to table a new Bill in Parliament that, among other things, seeks to remove the requirement for compulsory motor insurance.

According to the MP, the proposed Motor Insurance Bill 2024 will force insurance companies to take their role in protecting vehicle owners more seriously.

"I am finalising on this Bill that I want to table in Parliament come February 2025 after the House resumes from recess. It is only then, when insurance companies will start taking motor vehicle insurance as a serious policy," said the MP in a video statement posted on Instagram on Thursday.

Further, Jalang’o highlighted a critical issue with the current insurance system in Kenya, pointing out that while many vehicle owners pay premiums for insurance, they often fail to receive adequate compensation in the event of an accident.

He also criticized the behavior of insurance companies to hire individuals known as claims officers, whom he said frequently work to prevent full payouts or burden claimants with high excess fees.

"As we speak today, if you walk into any insurance company we have thousands of people lining up and waiting to be paid their claims after having an accident on a vehicle that they had insured, but we have these people called the claims officers who are employed by insurance companies to make sure that you are not paid," said the MP.

"Even if you are paid, they have this other thing called excess; they will always look for a way to make sure you don't get everything that you signed when you were getting insured."

The legislator also addressed the widespread issue of third-party insurance, which he claims is the most common form of coverage among Kenyans, warning that the cover is often inadequate, providing no coverage for the vehicle owner in the event of an accident.

He emphasized that many people only take out insurance to avoid arrest by the police, not because they expect to be adequately compensated after an accident.

"Kenyans do not take insurance because they want their vehicles insured, they take insurance to make sure that they are not arrested by the police…that is why most of the cars out here are on third-party insurance," said Jalang’o.

"Third-party is just a sticker that cannot help you if you had an accident; they will not pay you anything from a third-party and that is what 90 per cent of Kenyans run with around here. That tells you that people do not care about motor insurance because insurance companies do not actually pay."

The Bill, according to Jalang’o, aims to compel insurance companies to honor their promises to policyholders.

He noted that one of the provisions of the Bill would require insurance companies to agree, in writing, to fully pay claims for comprehensive insurance holders in the event of an accident.

Additionally, the Bill proposes that if a policyholder with comprehensive insurance does not make any claims during the policy year, they should be entitled to a refund of up to 50% of the premium paid.

"People pay upwards of Ksh.400,000 and insurance companies go and invest it. Can you imagine if you took Ksh.500,000 and put up a business? At the end of the year you would have had returns," he said.

"Insurance companies take our money, put it in their businesses and you do not get returns and when you get into an accident they also don't want to pay you fully. This Bill will now make insurance companies be very competitive, because they will start paying, they will start advertising and say we will insure you fully."

He added that; "It is a powerful Bill that will change how insurers deal with you when you have motor insurance…we want to make sure they start paying."