Invesco Assurance Company Limited (INVESCO) has been placed under statutory management by the Insurance Regulatory Authority (IRA), effective August 14, 2024, to protect policyholders and ensure sector stability. The IRA’s action addresses significant financial difficulties faced by the company.
IRA Commissioner General Godfrey Kiptum announced the appointment of the Policyholders Compensation Fund (PCF) as the statutory manager for Invesco. Kiptum has advised current policyholders to seek coverage from other licensed insurers immediately to avoid potential risks. The PCF will manage the compensation for affected claimants according to the Insurance Act, Cap 487 Laws of Kenya.
“The authority has appointed the Policyholders Compensation Fund (PCF) as the Statutory Manager for Invesco Assurance Company Limited (under statutory management). The insurer’s existing policyholders are advised to immediately seek alternative covers from other licensed insurers to ensure there is no unnecessary exposure. The Policyholders Compensation Fund will compensate the affected claimants as provided for under the Insurance Act, Cap 487 Laws of Kenya,” Kiptum stated in a formal announcement.
The Policyholders Compensation Fund (PCF) will manage Invesco Assurance Company Limited’s transition into statutory management. This includes protecting policyholders’ rights, overseeing ongoing claims, and facilitating compensation during the transition. Effective August 14, 2024, Invesco is no longer authorized to issue new insurance contracts.
Invesco has been facing severe financial challenges, resulting in a liquidity crisis that has hindered its ability to fulfill obligations.
The company has defaulted on claims amounting to approximately $400,000 (Sh53.3 million), primarily for road traffic accident victims. Additionally, Invesco is struggling with a backlog of 3,692,353 claims, having settled only 48,207 in the last quarter of 2022. This has led to a low payment ratio of just 1.2%, raising significant concerns about its financial stability.
Invesco’s last reliable financial filings were from 2018, when it collected Sh1.5 billion in premiums and held a 1.2% market share in general insurance premiums. Since then, the company’s financial situation has significantly worsened.
Invesco Assurance offers motor vehicle insurance, including for public service vehicles (PSVs), commercial vehicles, and private vehicles. It also provides non-motor insurance products such as fire and allied perils, burglary, public liability, and personal accident coverage.
