Resolution Insurance has suspended issuance of non-medical covers for 90 days, pointing to the deepening cash flow challenges the firm is grappling with.
The insurer’s acting managing director, Bernard Githinji said delays in clinching a deal for capital injection had exposed the company to a cash flow crisis.
“In consultation with the regulator, it has been decided [that we] stop underwriting of all new or renewing non-medical business with effect from March 27, 2022, for a period of 90 days. This is a precautionary measure to safeguard the interests of all our policyholders while providing an opportunity to de-risk and restructure the general business book,” he added noting that the firm will now focus on its medical insurance business.
The company last December revealed it was seeking a Sh2 billion shareholder capital injection to plug cash flow problems that had seen its customers turned away by some big hospitals due to late settlements of bills.
“I am hopeful that we will finalise on capital raising and take immediate measures to normalize operations and gradually rebuild customer confidence in the brand,” Mr Githinji said.
The insurer has since last year come under fire as clients poured their frustrations on social media over their inability to access health facilities as their medical cover cards get rejected.
The complaints, which have also been filed at the Insurance Regulatory Authority, have laid bare cash flow constraints at the business.
Resolution Insurance had 30 complaints filed with the IRA, just behind Xplico which had 43 client complaints and above Trident which had 25 customer filings according to the IRA quarterly report released in June.
The three insurers recorded a quarter of the 459 insurance complaints filed at the regulator in the six months this year.
There have been increased complaints against insurance companies from motor vehicle garages and loss assessors for delayed payments.
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