Court quashes IRA notice cancelling Trident, Corporate Insurance policies

The High Court has ruled that the Insurance Regulatory Authority (IRA) cannot invalidate existing insurance policies simply because an insurer has been placed under statutory management. The court found that the Commissioner of Insurance exceeded their powers under the Insurance Act when they issued a notice to cancel policies held by customers of Trident and Corporate Insurance companies.

The court interpreted Section 67C of the Insurance Act, which governs the appointment and functions of a statutory manager, stating that its purpose is to stabilize an insurer and protect policyholders, rather than automatically terminate existing insurance contracts. The court quashed the regulator's notice and found that the manner in which the directive was issued violated the constitutional guarantee of fair administrative action under Article 47.

The immediate effect of the judgment is that policies issued by Trident and Corporate Insurance before March 10 remain valid for the motor vehicle third-party insurance framework until a decision is made under Section 67C(7) of the Insurance Act.

Brief written by urgent.news from KahawaTungu's own syndicated text. Machine-written — may contain errors; check the original before relying on it.