The competition watchdog has forced 18 insurance companies to pay Sh38 million to 20 vehicle repairers and five motor assessors that had been kept waiting for years.
The anti-trust body launched investigations into major insurers that unjustifiably reneged on paying small businesses.
Competition Authority of Kenya (CAK) manager, buyer power department Priscilla Njako said some of the insurers had withheld payments for up to five years risking the survival of the garages and thousands of jobs in the sector.
The CAK did not disclose the identity of the rogue insurer but said the names will be listed in its annual report later in the year.
“The authority’s intervention has occasioned the release of over Sh38 million to these businesses, ensuring their sustainability and job opportunities,” Ms Njako said.
The CAK's new mandate to curb abuse of supplier-buyer power has seen it pursue retailers and insurers making up the largest proportion of late payment violations.
In the current financial year insurers made up 72 percent of buyer power violations followed by retail at 18 per cent.
Last year, the CAK revealed it forced Trident, Kenya Orient and Invesco insurance to pay Sh5.5 million to 16 motor vehicle garages for delays after fixing their clients' cars.
CAK compelled Kenya Orient Insurance to pay Sh1.2 million, Invesco Sh2.3 million and Trident Sh2 million for delays in payments for repairs some of which were done eight years ago.
The antitrust body said Invesco and Trident are still delaying in settling the late payments even after its intervention an indication of the struggles by the insurers in meeting their obligations.
The Kenya Motor Repairers Association, which has 168 members, said unlike hospitals, they cannot turn away insurance cars since the industry controls a huge chunk of the market.
Up to 80 percent of the business conducted by garages emanates from insurance companies, further entrenching their economic dependency on 38 listed motor insurers.
The garages' only option has been to file cases at CAK for abuse of buyer power and hope they get paid.
The regulator however found the insurance companies had abused buyer power unilaterally drawing lopsided contracts, delay of payments without justifiable reasons as well as constructive termination of contracts by the three companies.
In addition to the interventions in the insurance industry, the Authority has, since July 2021, secured the release of Sh5 Million in overdue payments to SMEs in the telecommunications and agro-processing sectors.