APA Insurance Company has blacklisted 28 models of Toyota, Honda, Maruti, Mazda, Nissan and Suzuki cars, barring their owners from accessing comprehensive covers for what it says are a misuse of the vehicles.
Those banned under the insurer’s Bima Bamba motor cover include popular Toyota models Wish, Vitz, Probox and Fielder, Honda (Stream, Fit, Airwave), Suzuki (Swift), Mazda (Demio, Axela) and Nissan (Tiida, Vanette, Wingroad)).
Bima Bamba is a comprehensive motor insurance cover that allows for payment of premiums to be made in instalments.
APA made the decision due to the frequent use of the cars in carrying passengers while they are registered as private vehicles, according to Ashok Shah, the chief executive of APA’s parent firm Apollo Investments Limited.
“Like many other underwriters, we do not insure vehicles which can be used to carry passengers. These have to be insured as taxis/buses,” said Mr Shah. “The models are blacklisted due to the wrong usage of the subject vehicles.”
Mr Shah said APA Insurance has stopped comprehensive covers for the models mainly due to their misuse, breaching the policy requirements.
Insurers are banning more car models from comprehensive covers, citing high losses from their misuse.
Cars such as those listed by APA are frequently registered as private vehicles but end up being deployed to ferry passengers, especially in rural areas. A comprehensive cover offers compensation for losses from multiple risks including theft, fire, vandalism and damage to the vehicle.
Claims under this type of insurance can be rejected for several reasons such as use of a private vehicle for commercial purposes or vice versa.
Claims for losses arising from driving while drunk can also be rejected.
Owners of the banned models will have to go to rival underwriters to look for those willing to take them on a comprehensive basis.
Comprehensive covers offer more benefits compared to third-party policy, which is limited to settling claims arising from damage to property belonging to others as well as death or injury to pedestrians and the general public.
Insurers have been developing strategies to contain losses in private motor policies. These include the exclusion of certain vehicle models, the use of technology and incentives for motorists to drive more carefully.
GA Insurance Limited also terminated comprehensive covers for at least six motor vehicle models in Kenya, citing unacceptable losses from the policies.
