ADVOKS GLOBAL · KENYA
Insurance Act
17. Directions to person investigated
Edition: 2023-12-11 · In force
17. Directions to person investigated
(1)The Commissioner may, by notice in writing, require a person investigated to comply by such date or within such period as may be specified therein, with such directions as he considers necessary in connection with any matter arising out of a report made under section 16.(2)Without prejudice to the generality of subsection (1), the Commissioner may, where the person investigated is an insurer, issue any one or more of the following directions—(a)that the insurer shall not issue new policies or undertake liability under new contracts of insurance;(b)that the insurer shall not renew existing policies;(c)that the insurer shall not issue policies in respect of a class of insurance business specified in the direction or undertake liability under contracts of insurance included in a class of contracts of insurance so specified;(d)that the insurer shall not renew existing policies in respect of a class of insurance business specified in the direction.(3)Without prejudice to the generality of subsection (1), the Commissioner may, where the person investigated is an insurer issue any one or more of the following directions—(a)that the insurer shall not dispose of or otherwise deal with an asset of the insurer or an asset of the insurer included in a class of assets specified in the direction;(b)that the insurer shall dispose of an asset of the insurer included in a class of assets specified in the direction, in such manner and within such period after the giving of the direction, not being less than twenty- one days, as the Commissioner so specifies;(c)that the insurer shall, within such period after the giving of the direction, not being less than twenty-one days, as the Commissioner specifies in the direction, make in his accounts such provision or further provision as the Commissioner so specifies in respect of unearned premiums or claims or in respect of both unearned premiums and claims;(d)that the insurer shall, within such period after the giving of the direction, not being less than twenty-one days, as the Commissioner specifies in the direction, adjust one or more of his reserves and make appropriate investment in connection with such reserve or reserves, as the case may be;(e)that the insurer shall make such arrangements with respect to reinsurance or retrocession as he so specifies;(f)that the insurer shall increase, so far as he is able to do so, his paid up capital whether by calling up such uncalled capital as is available to be called up or otherwise;(g)that the insurer shall not, except with the consent of the Commissioner—(i)enter into an arrangement or agreement for the sale or disposal of his business by amalgamation or otherwise or for the carrying on of his business in partnership with another body corporate; or(ii)effect a reconstruction of the insurer.(h)that the insurer shall, within such period after the giving of the directions, not being less than six months, as the Commissioner specifies in the direction, effect a reconstruction of the insurer.(4)If a body corporate in respect of whom a direction has been given under subsection (1), (2) or (3) is placed in liquidation, the direction ceases to have effect unless the court directs otherwise.(5)If the person under investigation is a body corporate and—(a)as a result of a report by an investigator, the Commissioner considers that it would be in the interests of policy holders for the body to be placed in liquidation; or(b)the body has failed, or is failing, to comply with a direction issued under this section,the Commissioner may, after giving the body a reasonable opportunity of making representations, apply to the court for an order for the liquidation of the body, in which case the provisions of Part VI of the Insolvency Act (Cap. 53) (as modified by Part XII of this Act) apply to the body.(6)Where, after reading a report made under section 16, the Commissioner considers that a requisition under paragraphs (b) or (c) of subsection (1) of section 9 has been made without reasonable cause, he may order that the whole or any part of the amount furnished as security under subsection (3) of that section shall be forfeited and paid to the person investigated and the Commissioner in order to defray the respective costs incurred by them.