Africa Merchant Assurance Company (Amaco), an insurance company associated with Deputy President William Ruto, is in trouble after the High Court sanctioned its closure over failure to pay Ksh10 million debt.
Justice Margaret Muigai ordered the liquidation of the company after it failed to pay the amount owed to six people following a lengthy court battle.
The six who include Elizabeth Karithi, Anisia Muthoni, Faith Muthoni and Silas Kinoti among others had moved to court after the firm failed to pay insurance claims some related to accidents.
The court heard that Amaco had in some instances issued the petitioners with bouncing cheques.
“It is clear that the company is unable to pay its debts and it is just and equitable that company should be wound up in the interest of justice,” the petitioners said.
Justice Muigai ordered the official receiver to oversee the liquidation process and eventually shut down the firm.
“That Africa Merchant Insurance Company Limited is hereby liquidated under supervision of the official receiver and liquidator,” the judge ordered.
A report by the Insurance Regulatory Authority (IRA) shows that Amaco closed the third quarter of 2019 with 1,649 outstanding claims, having settled only 215 during the period.
Last year, Mama Rael Medical Clinic raided Amaco offices over a Ksh15 million debt, and carried furniture from the offices. It is not yet clear how the case ended.
“This matter is giving us a headache. We will have another meeting next week Monday to agree on how the remaining Ksh14 million will be paid in installments,” said the claims manager Ken Kiprop after the raid.
This is despite Amaco collecting over Ksh2.1 billion in terms of customer premiums in the previous year, which was enough to pay such claims at a go.
Amaco reported a Ksh75 million profit in 2018 with claims dropping by five per cent from Ksh1.4 billion in 2017 to Ksh1.3 billion in 2018.