The Policyholders Compensation Fund (PCF) has declared a moratorium, freezing payouts to policyholders of three troubled insurers for six months following its appointment as statutory manager.
The affected firms, Corporate Insurance Company Limited, KUSCCO Mutual Assurance Limited, and Trident Insurance Company Limited, were placed under statutory management on March 10, 2026, by the Insurance Regulatory Authority (IRA) after failing to meet solvency requirements.
PCF Imposes Six-Month Payout Freeze on KUSCCO, Trident, and Corporate Insurance
PCF said it has assumed full control of the insurers’ operations for a six-month period, during which payments to policyholders, claimants, and other creditors will be suspended in line with provisions of the Insurance Act.
“Pursuant to the appointment of the Policyholders Compensation Fund (PCF) as Statutory Manager by the Commissioner of Insurance in exercise of his powers under Section 67C (2) of the Insurance Act dated 10th March 2026, the Policyholders Compensation Fund (PCF) declares a Moratorium in exercise of powers conferred to it under section 67C (10) of the Insurance Act on payments by the said insurer to its policyholders and all other creditors for a period of six (6) months with effect from the date of this appointment,” PCF said in separate notices for the three firms.
“Further, a policyholder shall not be liable to pay any claim not payable by the insurer due to the moratorium as provided under section 67C (11).”
A moratorium is a period during which an insurance company and its policyholders are protected from execution of any legal warrants and debt obligations.
During this period, the insurance company cannot issue insurance policies or process any claims.
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PCF is a State Corporation under The National Treasury, established under Section 179 of the Insurance Act (Cap. 487) and operationalized on 1st January 2005 through Legal Notice No. 105 of 2004.
Its primary mandate is to provide compensation to claimants of an insurer placed under a manager appointed under Section 67C (2) or whose license has been cancelled under the Insurance Act.
Why the Insurance Firms Were Placed Under Statutory Management
While placing the firms under Statutory management, IRA 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.
The authority has also directed that the three insurers are not permitted 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.
IRA 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.
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What the Insurers Cover
KUSCCO Mutual Assurance Company Limited primarily deals in long-term (life) insurance and retirement solutions.
Its core business is life assurance and pensions, targeting SACCO members and the wider public.
Meanwhile, Corporate Insurance Company Limited is also a general (non-life) insurer.
It typically offers Motor insurance, Fire and property insurance, and Personal accident and medical (where applicable)
Trident Insurance Company Limited, on the other hand, is a general (non-life) insurer. It mainly covers assets, liabilities, and short-term risks, not life insurance or pensions, and focuses on short-term insurance products such as Motor insurance (private, commercial, PSV) and Domestic package (home/property), among others.
