High Court validates Trident and Corporate Insurance policies

The High Court has ruled that insurance policies issued by Trident Insurance Company Limited and Corporate Insurance Company Limited remain valid, overturning a directive from the Insurance Regulatory Authority (IRA) that sought to nullify them.

The court found that the Commissioner of Insurance exceeded the powers granted by the Insurance Act when issuing a notice to invalidate existing contracts following the placement of both insurers under statutory management. Justice David Mburu noted that the purpose of statutory management is to stabilize an insurer and protect the public, not to automatically terminate existing contracts between insurers and their customers.

Furthermore, the court ruled that the regulator failed to provide policyholders with an opportunity to be heard or provide reasons for the decision, violating constitutional guarantees of fair administrative action under Article 47. The ruling also emphasized consumer protection rights under Article 46, noting that the directive exposed policyholders to significant economic loss.