Q AND A AS INVESCO ASSURANCE COMPANY LTD CEO OUTLINES BRIGHTER FUTURE

Who is Daniel Mugao, the CEO of Invesco Assurance Company Ltd?

Daniel Mugao is a career insurer since

1991. He holds B.Com Insurance Option

degree, Masters of Business

Administration Marketing. He is a

chartered Insurer and an Associate of

Insurance Institute London and Kenyan.

2. Who is Invesco?

Invesco is a limited liability company

licensed to write short-term contracts

of Insurance, what is generally known as

General Insurance. Our main market is

Public Transport Operators (Matatus) to

whom we provide Insurance. As you are

aware, we have 37-licensed General

Insurance Underwriters in Kenya but only

four (4) are currently covering

“matatus”. We consider ourselves key in

providing essential service because the

insurance we offer is high risk, made

compulsory by law as per Cap.405 of

Kenya

3. Tell us more about the “essential Service”

No Motor Vehicle is supposed to be on a

public road without a Certificate of

Insurance, including Matatus and Buses.

Matatus and bused provide transport for

labor to and from places of work. They

enable movement of people and goods. In

Kenya today, other means of Public

Transport like railway, airplanes and

water vessels contribute negligibly

compared to Matatus and Buses. You

cannot define our economic drivers

without mentioning transport. We come in

to provide Insurance as demanded by

law, thus providing a critical support

to the transport sector. Secondly, our

country suffers huge losses; injuries

and death, due to road accidents each

year. When quantified, the country

suffers billions each year. We come in

to compensate the victims, which we

consider very essential

4. Why are many Insurance Companies not interested in Matatu Insurance?

Insurance Companies in Kenya are private

companies existing for profit. Every

investor wants return on his investment.

Matatu insurance, what is commonly

known as Public Service Vehicle’s (PSV)

Insurance is a high-risk business faced

with unascertainable moral hazards. The

experiences from the behavior of our

drivers on the roads, law enforcers, the

judicial processes and the provisions

of the applicable laws makes it very

difficult for investors in this class of

insurance to make profit. Recently,

Small Claims courts were introduced to

fast track judgement within 90 days,

which prosecutes cases below Kshs. One

million. This has worsened the position

of PSV underwriters because they are

not given time to investigate

incidences, many of which are

fraudulent.

5. What Motivates Invesco to be in PSV Insurance Business

Members of the Matatu Owners Association

(MOA) own Invesco. We come in to

complement their business by providing

what is compulsory by law. We however

offer other classes of insurance, which

are not compulsory like the Material

Damage to vehicles, Fire and Theft to

property, Marine, Accident to persons

including employees among others.

6. What is the experience of Invesco in the PSV Business?

Like many players in Kenyan Motor

Insurance, our incomes have been

depleted by overwhelming claims. Our

customers have been adversely affected

by court rulings especially now with

Small Claims Courts. However, we have

elaborate plans to sustain the business

profitably within the next five years.

In the past, we were taken for a ride by

fraudstars presenting fake claims.

Situations like those presented by Covid

19 made it very difficult to

investigate and provide adequate

defense. We have put in measures to turn

around the business includes automating

the processes, prompt and thorough

investigations of incidences and

defense, involving clients like SACCOs

in risk management and prudence in

management. There is in place a fully

established Customer Experience

Department to drive customer delight. We

are experiencing positive outcomes from

these initiatives and our customers are

now happier.

7. How have you positioned yourselves for Recovery after the Order to close the company on 24th February 2023.

We were unfortunately closed on 24th

February in an unjustified manner. We

challenged the orders under certificate

of urgency and the court reopened the

company on 2nd March 2023. During those

seven days, we lost our Market. Since

reopening, we have been reaching to our

customers through various channels to

inform them of what transpired and

having them back. We have since

progressed to now 50% and we expect to

be at 100% of our market by beginning of

quarter four. It has not been easy for

the company noting that we have Claims

and operational expenses to pay. Most of

our creditors are very compassionate.

They have given us time to recover

after, which we shall resume to settle

their debts.

8. What are your expectation from the Market

I expect our customers to have

confidence in us and know that the

closure of the company on 24th February

was unwarranted. We need their business

support. The company is stable and

experienced qualified professionals are

running it. All the stakeholders are in

full support.

9. What plans do you have to guarantee your customers of a stable future?

We have clear plan to increase revenue

in order to meet our claims and

operational expense 2023 and beyond. We

have reviewed our business model and

aligned it to appeal to the market and

stand out from the competition. We have

identified and are actively pursuing

several areas where we believe there is

potential for growth. In addition, we

are investing in streamlining operations

through technology, diversifying our

portfolio to reduce reliance on PSV,

development of appealing products guided

by customer needs established through

research, employing cost-cutting

measures and recruitment of qualified

and experienced staff for critical roles

while training and retraining according

to needs. One very critical theme

guiding our strategy is customer

delight, which we are building capacity

to deliver continuously as a custom