Struggling matatu insurer Invesco Assurance Company has twice fallen into liquidation but was rescued by the High court on both occasions, plunging customers into confusion over the validity of their covers.
The Insurance Regulatory Authority (IRA), which had in mid-December stopped Invesco from issuing new covers, has lifted the order following a court order that saved the struggling company.
IRA Commissioner of Insurance Godfrey Kiptum said the regulator has received communication from the Official Receiver about the lifting of the liquidation order over Invesco, which effectively means the receiver was discharged from the liquidation duties.
“Consequently, the Court also directed the official receiver to surrender the company to its directors with effect from December 21, 2023. Following this Court Order, Invesco Assurance Company Ltd may continue issuing new insurance policies with effect from December 21, 2023,” said Mr Kiptum in a notice.
The order is the latest twist in the survival battle of Invesco, which the IRA had placed under liquidation on December 8 and immediately advised customers to stop entering into new insurance contracts while those with existing contracts were directed to the Policyholders Compensation Fund (PCF).
The liquidation order was related to two court cases against Invesco in Malindi and Nairobi. High Court Judge Alfred Mabeya who lifted the latest order said liquidation order is “serious business” with serious consequences to the debtor company and should not just be used as a way of arm-twisting debtors to pay.
“Once a petitioner has decided that a debtor company should be liquidated, it is insensitive for such a petitioner to turn back and say “oh wait a minute, I have received my money back. Hold the process.” That is not available,” said the judge.
IRA had on February 24 placed Invesco under liquidation following a petition, but the High Court on March 3, directed the regulator to reinstate its license after Invesco successfully challenged the directive in court.
Despite the order returning it into business, questions abound over Invesco’s ability to honor claims in the current financial crisis with IRA data showing that it had the highest outstanding liability claims at 3.85 million at the end of September last year, up from 3.69 million at the end of 2022.
The piling litigation and court orders have thrown customers into confusion, especially with some taking to social media to complain over harassment by traffic police officers.
