Resolution Insurance company is now facing imminent liquidation after nearly 21 months of struggle to revive the financially distressed entity.
The High Court appointed Long’et Terer as the interim liquidator on January 11, for Resolution Insurance. The cash-strapped insurer was established in 2002 as Resolution Health and later renamed to Resolution Insurance in 2013.
The appointment of the liquidator was officially gazetted last Friday, initiating the process of evaluating all outstanding obligations owed by the insurer to individuals.
The primary objective is to settle these liabilities using proceeds generated from the sale of the insurer’s assets or the recovery of any debts owed to the company.
Long’et Terer, the interim liquidator, emphasized the importance for creditors to submit full particulars of their claims against the company. Failure to do so may result in exclusion from any distribution made before such debts are proven, as stated in a gazette notice.
In April 2022, the Insurance Regulatory Authority (IRA) directed the Policyholders Compensation Fund (PCF) to intervene as the statutory manager of Resolution Insurance.
The statutory management status imposed a moratorium on policyholders and creditors owed money by Resolution Insurance. However, this moratorium has now been lifted, and the outstanding dues of policyholders and creditors are contingent on the funds generated from the liquidation process.
The regulatory authority had expressed concerns in the previous year after examining the insurer’s financial records, revealing a deficit of Sh3.6 billion.
Despite the company’s promising performance in the local business landscape over the past decade, the significant financial deficit made the revival of Resolution Insurance impractical.
