Kenya's Court of Appeal last week upheld the High Court's decision to quash the Motor Insurance Underwriting Guidelines issued by the Insurance Regulatory Authority (IRA) in 2009.
A notice shared on 30 October 2024 by the Commission on Administrative Justice (CAJ), also known as the Ombudsman, stated that the guidelines were originally issued to set fixed rates for motor insurance premiums for all insurance companies, reported The Kenya Times.
The Ombudsman challenged the guidelines on behalf of motorists, arguing that the guidelines were unconstitutional.
In March 2017, the High Court sided with the Ombudsman, ruling that the guidelines were unconstitutional and beyond the IRA’s mandate, arguing that the IRA lacks the authority to set tariffs.
The IRA and the Attorney General appealed against the High Court decision, maintaining that the IRA had acted within its powers and was justified in issuing the guidelines to stabilise the motor insurance sector.
However, the Court of Appeal upheld the High Court’s ruling, finding the guidelines to be “irrational, unreasonable, and disproportionate”. The court warned against any regulations that might unfairly favour specific companies or turn the industry into a cartel.
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