Hope for Blue Shield claimants as lawsuit begins

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Blue Shield Insurance Company Limited claimants can now hope for compensation as the courts set a hearing date for a motion to wind up the troubled underwriter.

The High Court’s Commerce and Admiralty Division has set November 25 as the date for the hearing of the petition to begin.

Underwitter stakeholders opposed or in favor of driving the last nail into the insurer’s coffin should be directed to petition by the Insurance Regulatory Authority (IRA) when the hearing begins.

Compensation for claimants in Blue Shield is only expected to begin after the winding-up petition has been concluded.

This is because the subscriber was placed under the statutory management of the Insured Compensation Fund (PCF) before a change in the law authorizing compensation before liquidation which blocked any payment to the insured.

United Insurance is another insurer in difficulty but in which policyholders are awaiting its dissolution before receiving compensation.

The pair’s claims are estimated at Ksh 3.4 billion while claims payable by the PCF, a hedge fund for policyholders, are estimated at Ksh 2.5 billion.

A series of challenges, including counter-petitions, have so far prevented the insurance regulator, the IRA, from liquidating the two companies.

Blue Shield Insurance Company Limited was placed in receivership in September 2011 and has Ksh 2.2 billion in estimated insured claims.

Established in 1982, the underwriter had its base of operations in life and health insurance.

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