Three Kenyan insurers collapse, leaving Sh3.4billion in unpaid claims
More than 20,000 policyholders have been left exposed following the collapse of three Kenyan insurance firms, with unpaid claims rising to Sh3.43 billion, highlighting deep-rooted financial weaknesses in the sector.
Data from the Insurance Regulatory Authority (IRA) shows that Trident Insurance Company, Corporate Insurance Company and Kuscco Mutual Assurance owed a combined 20,852 claimants billions of shillings by December 2025.
The regulator placed the three firms under statutory management on March 11, citing multiple breaches including weak capital positions and persistent failure to settle claims within the legally required 90-day period after assessment.
Breakdowns show Corporate Insurance Company had the highest unpaid claims at Sh1.24 billion from 8,182 cases, followed by Kuscco Mutual Assurance at Sh1.09 billion involving 2,573 claimants, and Trident Insurance Company at Sh1.088 billion from over 10,000 claims.
The three firms’ liabilities form part of a wider industry backlog of Sh82.4 billion in outstanding claims, underscoring systemic stress in the insurance sector.
To shield customers from further losses, the IRA handed over management of the troubled insurers to the Policyholders Compensation Fund (PCF), which will oversee compensation and attempt to revive the firms.
Under the current framework, affected policyholders will receive compensation of up to Sh500,000 each—the highest payout ever, following a recent increase from Sh250,000.
PCF director of compensation and insurance risk monitoring Noel Zuma said payouts will begin after the fund takes over claims records and completes processing.
The fund is expected to start receiving claims within weeks, with payments likely to begin after a 90-day processing window, potentially from mid-year.
PCF will also explore the possibility of restructuring the insurers over a six-month period. If recovery efforts fail, liquidation will be recommended.
The collapse of the three firms adds to growing concerns over governance, capital adequacy and delayed claims settlements in Kenya’s insurance industry, with regulators now tightening oversight to prevent further failures.
