Amaco liquidation put on hold


Milimani Law Courts. FILE PHOTO | NMG

A judge has temporarily stopped the liquidation of 22-year-old Africa Merchant Assurance Company (Amaco) over a Sh10.2 million debt, offering a sigh of relief to the firm associated with Deputy President William Ruto.

Justice Margaret Muigai temporarily put on hold the process to wind up of the company on Wednesday to allow the underwriter to appeal the ruling to liquidate it.

The judge had a few days ago ordered the liquidation of the company after it failed to pay a debt it owes six people.

The six including Elizabeth Karithi, Anisia Muthoni, Faith Muthoni and Silas Kinoti, filed cases against the company before courts in Embu, Runyenjes and Ngong seeking various amounts following accidents.

“The court grants temporary stay of liquidation of the company pending hearing and determination of the application,” said Justice Muigai.

“Further directions shall be on December 9, 2020.”

The court also heard that the judgments and decrees obtained by the six have been served on the company and have never been set aside nor appealed.

They also revealed that plans to attach the company’s properties have been unsuccessful, leaving them with no other option but to wind up the firm.

“It is clear that the company is unable to pay its debts and it is just and equitable that company should be wound up in the interest of justice,” the petitioner’s said.

According to the Insurance Regulatory Authority’s 2019 report, Amaco reported 1,649 cases of unsettled liability claims with none settled compared to its second quarter’s 1,705 cases during which 169 were settled.

Outstanding non-liability claims stood at 2,005 cases up from 1,907 reported in the quarter during which 444 fresh claims were made and 346 claims paid.

In 2018, Amaco recorded a Sh75 million after-tax profit mainly boosted by lower operating costs.

Liabilities decreased to 17 per cent to stand at Sh1.8 billion compared to Sh2.1 billion the previous year.

The firm drew up to 62.6 per cent of its business worth Sh2 billion from motor premiums.

Last year, Amaco recorded a Sh75 million after-tax profit mainly boosted by lower operating costs.