IRA Proposes Stricter Rules on Claim Rejections

The Insurance Regulatory Authority (IRA) has published the draft Insurance (Claims Management) Guidelines, 2025, introducing tighter procedures on how insurers process and reject claims. The draft comes amid a sharp rise in declined payouts, with insurers rejecting claims worth KES 1.51B in the first half of 2025, up from KES 879.9M in the same period last year. The new framework seeks to standardize claims handling and limit the discretion insurers currently have in rejecting or delaying settlements.
Under the proposals, insurers will be required to acknowledge claim notifications within two working days and make settlement offers or communicate decisions within seven days of receiving investigation reports. They will also be barred from requesting information at the claims stage that should have been obtained when issuing the policy.
The guidelines further outline specific grounds that can no longer be used to decline claims, including:

• • Non-disclosure of facts that a policyholder could not reasonably have known.

• • Undiagnosed pre-existing or congenital medical conditions.

• • Expired driving licences if the driver was not disqualified.

• • Late reporting without verification of reasons for the delay.

• • Breach of policy conditions where the policy document was not issued at inception.

• • Non-payment of premium where the cover was not formally cancelled or the cancellation was not communicated.

In motor insurance, insurers will be required to conduct valuations at both inception and renewal, while claimants will have the freedom to choose a repairer from an insurer’s panel or appoint an independent qualified repairer. Contribution to repair costs will be limited to wear-and-tear or rebranding items. Each insurer will also be expected to maintain a detailed claims manual, establish customer service channels to handle complaints, and strengthen fraud detection systems.
The IRA will retain enforcement powers to issue directives, impose penalties, or withdraw licences for non-compliance.

Kenya Re CEO Withdraws Court Case Against Employer

The Employment and Labour Relations Court in Nairobi has marked as withdrawn a case filed by Kenya Reinsurance Corporation CEO Hillary Wachinga against his employer after he opted to discontinue the proceedings.

Mr. Wachinga had moved to court on 22 September 2025, seeking to stop a disciplinary hearing that had been scheduled for the following day. He argued that the process violated his rights to fair hearing and fair administrative action, citing contradictions between his suspension and show-cause letters issued earlier in September.

In response, Kenya Re stated that the disciplinary process arose after the CEO failed to complete investigations into two employees as directed by the board, and for recommending their termination before they had responded to allegations. The corporation said the disciplinary action was in line with its internal procedures.
Although the court had initially granted a temporary stay on the disciplinary hearing, Mr. Wachinga later filed a notice on 8 October 2025 to withdraw both the application and the entire case.