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The Matatu insurance industry in Kenya has long faced turbulent times, with multiple collapses of major insurers over the years, leaving public transport stakeholders grappling with uncertainty. The latest in this string of challenges has prompted the Matatu Owners Association (MOA) to call on the government to intervene and save the sector from further disarray.
MOA President Albert Karakacha emphasized the vital role the public transport sector plays in Kenya’s economy and warned that the collapse of matatu insurance providers could have dire consequences for both the industry and the general public. He recalled the fall of notable insurers such as Kenya United Insurance Company, Kenya National, Access Insurance, Stallion Insurance, and Lake Star Insurance, highlighting how the ongoing collapse of Directline, once the benchmark of matatu insurance, has left the sector in uncharted waters.
“We care about the common mwananchi, who is the one suffering the most in the event of an accident,” said Karakacha. “Most victims wait for decades to receive their claims, and they bear the brunt of corruption in the legal system and fraud within the judiciary. Our call is for the government to engage with us and consider our solution, which includes training drivers in road safety and vehicle maintenance, and collaboration with other stakeholders.”
Karakacha emphasized that without government action, the association may be forced to take drastic steps, including advising its members to cease having insurance coverage altogether. He noted that such a move would deprive the government of significant revenue generated through the insurance sector, potentially triggering a broader crisis.
The MOA also urged the Law Society of Kenya to address issues of fraud within its ranks, pointing to a survey that found 40% of insurance fraud is linked to lawyers. Additionally, the association called on the Chief Justice to tackle the corruption plaguing small claims courts, which has further compounded the challenges facing accident victims.
Karakacha reaffirmed the MOA’s commitment to resolving the insurance crisis, adding that they have developed a plan to stabilize Invesco, a key insurance provider. “Through MOA, we have a plan for Invesco. The company is stable, and with our approach, we believe we can turn the tide and create a sustainable future for matatu insurance,” he said.
He concluded with a plea for President William Ruto’s intervention, underscoring the urgent need for government support in restoring confidence and stability in the sector. “The government must act now to empower matatu SACCOs and work with us to craft a viable, multi-pronged solution that addresses the root causes of this crisis,” Karakacha said.
