The process of selling the assets of United Insurance to pay creditors, including lenders and policyholders, has finally taken off 20 years after the insurer was placed under receivership.
Kamal Anantroy Bhatt, the court-appointed administrator of United Insurance, has invited all of the insurer’s creditors to lodge their claims. This is the clearest intent to finally wind up the company and end a protracted legal process that High Court judge Alfred Mabeya described as a “classic case on how litigation should not be in this country.”
On June 14, 2024, Justice Mabeya appointed Mr Bhatt as the liquidator of United Insurance, seeking to end the lengthy litigation triggered by the takeover of the company by the regulator.
“Notice is hereby given that, pursuant to the provisions of the Insolvency Act and further to the appointment of Kamal Anantroy Bhatt...as liquidator of United Insurance Company Limited, a meeting of the creditors of the company will be held on Thursday, 2nd October 2025,” reads the notice published on September 26, 2025.
The Insurance Regulatory Authority (IRA) took over the company in July 2005 after the insurer’s liabilities exceeded its assets, making it difficult for it to meet claims from policyholders.
By the time the IRA placed the company under statutory management for breaching the Insurance Act, it had admitted assets of Sh475 million against liabilities of Sh2.25 billion.
As at December 2004, the liquidity ratio —a metric for measuring a company’s ability to pay its short-term debt obligations by comparing current assets to current liabilities— was 0.03 to 1, far below the legal requirement ratio of Sh1 assets for every Sh1 liability.
By the time it was placed under statutory management, the company had also issued unsecured loans to directors, failed to meet tax obligations, and left policyholders unpaid for over a decade.
Other than United Insurance, insurers that have been placed under receivership, statutory management or liquidation by the IRA include Invesco Assurance, Xplico Insurance, Blue Shield Insurance, Standard Assurance, Concord Insurance, and Resolution Insurance.
In the event of the liquidation of a Kenyan insurer, the first liabilities to be settled are the liquidation and statutory management costs, followed by policyholders’ claims, then secured creditors.
The next liabilities to be settled are preferential debts such as taxes and employee wages, followed by unsecured creditors, subordinated debts, and finally, if anything remains, shareholders.
Shareholders of United Insurance —including George Ngure Kariki and other investors— opposed the liquidation of the company, arguing that the company was solvent to the tune of Sh1.3 billion. The shareholders stated that there were two reports from the IRA’s commissioner, one for liquidation and the other for revival.
There was also an argument, both from shareholders and policyholders who also opposed the liquidation, that the company had properties valued at Sh4 billion.
However, most of these assets, besides having caveats or being registered in a subsidiary of the company, could not be easily converted into cash in case of a cash crunch, said Justice Mabeya.
“It is important to note that availability of assets do not equate to the solvency of an insurance company. If those assets cannot be easily liquidated to generate money to rescue the company, then they do not aid the process,” said Justice Mabeya, adding that in considering the liquidity and solvency of an insurer, capital assets are not to be considered.
“By heavily investing in land, the company shot itself in the hip as the same proved difficult to easily liquidate and produce liquid money to turn around the company. Further, by having 50 percent of its assets registered in its subsidiary, that was a serious breach of the Act.”
