Africa Merchant Assurance Company Limited (Amaco) has been given a seven-day ultimatum to clear a Sh19 million debt or face regulatory action.

The non-governmental organisation, Mama Rael Memorial Foundation, had claimed that the insurance company had been evading payment of the debt by concealing its assets in a court dispute that has now entangled it to a local lender.

“We refer to the attached complaint on the delayed settlement of judgment which has remained outstanding to date. You are required to settle the decretal amount of the judgment of court within seven days from the date of this letter failure to which further regulatory action will be taken against you,” IRA said in a letter to Amaco CEO.

Evading payments

The insurer, which is linked to Deputy President William Ruto, is on the spot over allegations of hiding assets to evade auction by a non governmental organisation (NGO), which is claiming the amount.

It is reported that Access Bank, formerly Transnational Bank, which is the banker of the insurer had quoted a different bank balance compared to what the company quoted in court. The court dispute entangles Access Bank which has been accused of aiding the insurer to conceal the actual bank balances amid reports that indicate the company had contradicting account.

The NGO had complained to the regulator over the issue saying they are unable to execute the court order as the insurer  did not state correct details of its bank balances and also  provided shifty accounts of assets.

“Amaco failed to pay our client, contrary to the court judgment, provisions of the Insurance Act and Regulations. The directors and officials of Amaco have unlawfully concealed their assets and proceeds in bank accounts, thus making it difficult to execute against it,” the NGO said in a letter.

This comes months after the Insurance Regulatory Authority warned X-plico and Amaco insurance companies over customer complaints due to delayed claims.

Data from the regulator shows that Amaco pays only ten per cent of the claims filed by its customers making it a risky bet for policyholders.