The Nation (Nairobi)
Walter Menya
5 July 2009
Nairobi — The Treasury is studying proposals to introduce a universal insurance product cover for businesses against political disturbances, alongside current insurable risks.
This follows a reluctance by insurance firms to compensate traders who lost their businesses in the post-election chaos.
Assistant Finance minister, Dr Oburu Oginga, told exhibitors during the Insurance Regulatory Authority (IRA) open day in Kisumu, that many issues had arisen that have made it difficult to draw a line between political insurgencies as defined in insurance contracts and mere disturbances, which are covered, necessitating the introduction of a universal cover.
"We are studying proposals to introduce a universal insurance product to cover these risks as is the case in South Africa," he said in a speech delivered on his behalf by Treasury official, Chiboli Shakaba.
However, the assistant minister warned the industry to clearly spell out the terms to eliminate any grey areas in the contracts.
"The IRA should work with insurance companies to ensure that policy terms and conditions are simple to understand by the insured," he said.
IRA chairman, Steve Mainda and the chief executive Sammy Makove also warned insurance firms against using terms that clients cannot understand.
Many traders, especially those in Kisumu, have not received compensation for property destroyed during the post-election crisis after insurance firms declined to compensate them.
Intervened
However, Dr Oburu told the traders that the government has intervened on their behalf and they are set to get full compensation for their losses.
"Discussions are on-going with those that have not made any payment to do so and help those who suffered losses re-establish themselves. The underwriters have expressed a willingness to make some form of payments and this may be happening soon."
So far, insurance companies have paid more than Sh120 million to businesses in Kisumu towards the post-election violence claims yet others had previously turned down the claims, Dr Oburu noted.
Kisumu suffered heavy losses in the clashes that claimed a supermarket store, hotels and several small businesses.
Be the first to Write a Comment!
Copyright © 2009 The Nation. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com).
AllAfrica aggregates and indexes content from over 125 African news organizations, plus more than 200 other sources, who are responsible for their own reporting and views. Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica.
