The Directline Assurance Company, which controls more than 60% of Kenya’s Public Service Vehicles (PSVs) insurance market, has ceased operations. Dr. SK Macharia, Chairperson of Royal Credit Limited, which owns the insurance company, announced the termination of all Directline employees and the immediate dissolution of the company’s Board of Directors. Royal Credit Limited is set to take over all assets owned by Directline.
The closure was prompted by the freezing of the company’s bank accounts by the Insurance Regulatory Authority (IRA). Dr. Macharia criticized the IRA for failing to take action against former directors accused of mismanaging funds totaling Ksh7 billion.
As a result of the closure, Directline has suspended all insurance services, leaving the transport industry in dismay given its status as the leading motor vehicle insurance provider in the country. Directline entered the Kenyan market in November 2005 as a motor vehicle insurance company.
In the 2022/2023 fiscal year, Directline’s income stood at Ksh4.1 billion, up from Ksh3.6 billion the previous year. The company attributed the profit increase to partnerships with market intermediaries, including 3,200 agents, 83 brokers, and 17 banks. Earlier this year, while announcing its profits, the company outlined ambitious plans to diversify its product portfolio.
In February, Directline announced a transition to cashless fares in an effort to curb fraudulent claims related to passenger injuries and deaths.
