The Policyholders Compensation Fund is the claimant's last resort in case an insurance company goes under, PCF principal officer Hellen Mokaya has said.
Mokaya assured Policyholders and claimants across the country that they were safe with insurance covers despite which insurers they have subscribed to.
"I dispel the fallacy that insurance companies are fraud. Insurance companies are regulated by the Insurance Regulatory Authority (IRA)," Mokaya said.
She addressed the press in Machakos County on Tuesday.
Mokaya said there are set minimum capital requirements which an insurance company needs to meet before it's set up and registered by relevant authorities to operate in the country.
"So, somebody can't raise such a huge amount of capital to come and commit fraud. Also, insurance companies day to day operations are regulated and monitored by IRA for both policyholders' and claimants' interests," Mokaya said.
She said insurance companies' licenses are cancelled or suspended if the regulator realises that they aren't operating as per their mandates.
"As PCF, we want the public to know that they have a safety net in case your insurance company collapses or goes under. We are your last resort, come make your claims with us," Mokaya said.
PCF is conducting a one-week sensitisation Forum in Machakos County through its programme dubbed, PCF Mtaani.
The state agency is sensitising the public on its mandate. The sessions which began on Monday end on Friday.
"Yesterday, we were handling the media team given that they are also our greatest stakeholders in PCF. We are educating people on our mandate," Mokaya said.
"Our core mandate is to compensate policyholders of insurance companies whose licences have been cancelled. We also do statutory management where a company is brought to us to revive."
Mokaya said the sensitisation programme was informed by the fact that most policyholders don't know that 'this state corporation' exists.
"The Five-Day campaign will see PCF meet with special interest targeted groups that include Media, Insurance Agents, Boda Boda/Tuk Tuk Riders, Matatu owners and other stakeholders including the DCCs/Chiefs, Business Community, Kuppet, Knut, Women, Youth, Religious groups and Co-operatives to sensitise them," she said.
She said as PCF, they had also realised that most people don't know where to seek help when their insurance companies' licences are cancelled.
"What we did is to come up with a plan on how we are going to reach people and tell them what we do. We have been conducting these sensitisations in counties," She said.
She said they have this year conducted such forums in Mombasa and now in Machakos County.
"Last year, we were in Nakuru and Kisumu counties. We have a plan to cover all the 47 counties. We have been doing these fora in a quarterly basis," Mokaya said."We want the public to know, we are here for you. Don't panic, we are there to bridge that gap," Mokaya said.
Mokaya said the move was part of the strategic plan to increase the level of awareness of the PCF’s mandate and functions as well as calling members of the public to come forward and lodge their claims for insurance compensation. The maximum amount for compensation is currently gazetted as Sh250,000 per claim.
The Fund launched compensation for policyholders of collapsed insurers on March 10, 2021, following an amendment to the Insurance Act in 2019. Worth noting is that prior to the amendment, compensation for policyholders and claimants only commenced upon a collapsed insurer being fully would up in court.
Due to delays in the winding up process for insurers in court, policyholders were unable to lodge claims for compensation and were thus unable to receive any reprieve from compensation for their claims with the collapsed insurers.
The Fund spearheaded the amendment of the Insurance Act to replace the requirement for winding up with a requirement for insurers to be placed under statutory management or have their licenses revoked for compensation to commence.
