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Policyholders Compensation Fund: Africa’s No 1 Insurance Guarantee Scheme

Policyholders Compensation Fund

Have you ever wondered what would happen if the insurance company that has covered your vehicle, property, and health or your family’s well being collapsed? After reading this post, I guarantee you’ll get a satisfactory answer to your question.


Before I give you the answer, let me give you with some context. All insurance companies and brokers in Kenya are accountable to the Insurance Regulatory Authority (IRA). IRA is a statutory government agency established under the Insurance Act CAP 487  of the Laws of Kenya to regulate, supervise and develop the insurance industry. Whenever a company fails to meet their obligations, which is settling their customers’ claims, they are placed under statutory management or in extreme cases under liquidation by the IRA.


Statutory Management

If a company is placed under statutory management, it means that the PCF takes immediate control and management of the insurance company’s business and assets and may operate the company until they permit it to resume business on its own subject to any terms and conditions the PCF may impose.


If an insurance company is ordered to be liquidated, it means that their operating license is revoked and their assets are sold. The PCF facilitates the liquidation and uses the revenue generated to provide compensation to the liquidate company’s active customers prior to the liquidation.

Policyholder Compensation Fund (PCF)

Whenever an insurance company is placed under statutory management or liquidation, the company’s management and operations are with immediate effect taken over by the Policyholder Compensation Fund (PCF). The PCF is a state corporation under the national treasury created to make sure that insurance customers in Kenya are compensated even if a company ceases its operations.


Over the years, the PCF has become a trendsetter. They hold the record of being the first and only insurance guarantee scheme in Africa. Since the PCF began operations in 2005, the fund has compensated more than Kes 90 Million in claims of insurance companies that have  collapsed in the past.

Policyholders Compensation Fund

Compensations Made by PCF

CompanyCompensation ClientsCollapse Year
Resolution Insurance Co. LTD

Kes 82.21 Million7782022
Concord Insurance Co. LTDKes 9.02 Million452018
Standard Assurance Kenya LTDKes 9.02 Million92018

The most recent companies to face the wrath of the IRA are Invesco and Xplico. In 2023, the IRA ordered that Invesco Insurance company should be liquidated and Xplico  to be placed under statutory management.


Besides the most recents companies controlled by the PCF, there are other companies that have failed to fulfill their obligations in the past.

Companies Placed Under Statutory Management

Blue Shield Insurance Company LTD2017
United Insurance Company LTD2018
Resolution Insurance Company LTD2022
Xplico Insurance Company LTD2023

Companies Placed Under Liquidation

Standard Assurance Kenya LTD2018
Concord Insurance Co. LTD2018
Invesco Assurance Company LTD2023

Insurance companies have collapsed in the past. and more insurance companies will collapse or get placed under statutory management in the future. If the insurance company you’re using were to ever collapse, then remember the advice below. It’s the same advice we gave to some of our clients who were affected by the recent Invesco and Xplico incidents.

Our Advice to Policy Holders

The first thing you should do if your company collapsed is get another insurance cover from an active and reputable insurance company through your insurance broker or agent to avoid unnecessary inconveniences such as being stopped by the traffic police on Kenyan roads.


If you fail to get another insurance cover for whatever reason, and you get into an accident or have an insurance claim, don’t worry. The PCF’s reason for existence is to help policyholders with your problem. You should file a claim with the PCF (Contact details below) within 2 years to be eligible for compensation from the fund.

PCF Contact Details


The short answer to your question, “What would happen to your insurance policy if the used company collapsed?” is that you’ll still get compensated if you have a claim even if the company you used was shut down. If the insurance company of your choice were to ever collapse, you shouldn’t panic or get worried because the PCF has got your back. You should be keen to follow the advice given above to make sure that you get compensated when you have a claim.

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