Regal insurance has been suspended from underwriting any business following its failure to settle policy claims, the NewsDay has established.
BY FIDELITY MHLANGA
Documents seen by this paper show that the company is under investigation by the Insurance and Pensions Commission (Ipec) after fleecing policy holders.
A communiqué by Ipec acting commissioner, Blessmore Kazengura, to Regal Insurance dated September 20, notified the company that the commission had resolved to institute investigations, commencing September 24 in terms of the Insurance Act.
“Given the fact that we have complaints alleging that you are failing to pay claims in time, it is, therefore, our considered position that it would be in the interests of existing and prospective policy owners, that for the period of the investigation, in terms of section 67 (3) of the insurance Act (chapter 24:07), Regal Insurance Company is prohibited from initiating any new insurance business or class of insurance business unless authorised to do so by the commission in writing. For the avoidance of doubt, Regal Insurance Company is prohibited from renewing existing policies as well as taking on board new policies,” the communiqué read.
“These complaints are a reasonable cause for the commission to suspect that your institution is treating policyholders unfairly, especially noting that complaints continue to be registered with Ipec, and the documents and information furnished by yourselves to the commissioner show that the insurer has failed to comply with section 26A (2 )and 29 (3) of the Insurance Act (chapter 24:07), which sections relate to investments in prescribed securities and maintenance of an insurance fund, respectively.”
During the investigation period, Ipec prohibited the company from disposing any property connected with its insurance business and also ordered the company to surrender title deeds, share certificates and all bank statements for the company on September 20.
“You are also prohibited from making any withdrawals from all the insurers’ bank accounts without approval from the commissioner, and operating any account with nay bank, building society or financial institution,” Ipec said.
Regal Insurance chief executive Leckias Gumbo did not respond to questions sent to him by the time of going to print.
Ipec could not be reached to comment on the investigations.