GA Insurance Limited will not provide comprehensive covers for at least six motor vehicle models in Kenya, citing unacceptable losses from the policies. The firm has written to its business partners, saying it will no longer issues covers for Toyota Probox, Toyota Succeed, Toyota Sienta, Toyota Passo, Toyota Porte and all Suzuki models valued at less than Sh1 million.
“After a comprehensive review of our motor private book and the loss trends, we wish to communicate that there are vehicles whose usage has been misemployed and therefore have proven to be a challenge when settling claims,” the company wrote in the letter dated October 21.
“We will therefore not underwrite the below models on comprehensive basis to ensure smooth running of business and maintain an excellent client experience.”
A source familiar with the matter told Business Daily that the company stopped comprehensive covers for the models mainly due to their misuse, breaching the policy requirements.
A comprehensive cover offers to compensate for losses from multiple risks including theft, fire, vandalism and damage to the vehicle.
Claims under this type of cover can be rejected for several reasons such as use of a private vehicle for commercial purposes or vice versa.
Claims for losses arising from drink-driving can also be rejected. Small cars such as those listed by GA Insurance are frequently registered as private vehicles but end up being deployed to ferrying passengers, especially in rural areas.
GA Insurance’s claims in the private motor vehicle business rose to Sh1.07 billion last year, up from Sh712.2 million in 2020. This business line generated the largest underwriting loss of Sh193.9 million in the review period.
Owners of the models flagged by GA will have to go to rival underwriters to look for those willing to take them on a comprehensive basis.
