2,000 insurance holders still in limbo

THE Pensions and Insurance Authority (PIA) has not been able to mobilise enough resources to pay the over 2,000 policyholders who were affected by the liquidation of the two insurance firms in 2017.

PIA, which was expected to start paying out the policyholders yesterday, expects to raise about K1.3 million to pay affected people their full amounts.

In 2017, PIA placed Focus Life Assurance and A Plus Life Assurance Limited under liquidation for insolvency.

“I must mention that unfortunately the policyholders will not be able to get everything, what we have realised is insufficient to meet the debts.

“It has to be clear that we have not realised sufficient resources to meet all the obligations, so there will be a haircut. Everyone will have to have whatever is due to them sort of reduced,” said PIA Registrar, Christopher Mapani in an interview.

The two liquidations affected in excess of 1,800 policyholders under Focus Life Assurance and 780 under A Plus Life Assurance.

Mr Mapani said PIA had challenges deposing off assets for A Plus Life Assurance Limited as some of the motor vehicles were not in good shape.

He also explained that PIA struggled to get a good price and ended up dispesing them cheaply.

“The law provides that apart from secured creditors, all other creditors [policy holders] have to be paid in equal proportion, so there will be a haircut

“This means that we will look at what we have realised, if we only realise 10 percent, it means that those policy holders will only be paid up to a maximum of 10 percent,” Mr Mapani said.

Mr Mapani however said PIA had completed the disposal of process and that they would move to the next phase of starting to pay out.

He said PIA was working on the payments modalities of the policyholders.

Mr Mapani said PIA was exploring ways of how to pay out the policyholders without putting them at risk amid COVID-19.

“In normal times, we could have paid out having them come to a physical location but with the COVID-19, that is not possible.

“So we are trying to find alternative ways of paying them without putting people at risk. We are looking at mobile payments and bank transfers,” he said.

I must mention that unfortunately the policyholders will not be able to get everything, what we have realised in insufficient to meet the debts