Insurance Claims

An insurance claim is the process by which a policyholder notifies the insurer of a loss and seeks payment under the insurance policy. In Kenya, insurance claims are governed by the Insurance Act (Cap 407), the policy terms and conditions, the principles of contract law, and the common law principles of insurance — including utmost good faith (uberrimae fidei), indemnity, subrogation, and contribution. The claims process is where the value of an insurance policy is tested, and it is the stage at which disputes most frequently arise between insurers and insureds.

Advocates offering this service act for both policyholders and insurers. For policyholders, they manage the claims process from the moment a loss occurs. Advocates advise on the notification obligations — most policies require the insured to notify the insurer of a loss "as soon as practicable" or within a specified period, and a failure to notify can result in the claim being declined. Advocates assist with the preparation of the proof of loss — the formal document that sets out the circumstances of the loss, the amount claimed, and the supporting evidence. Advocates coordinate with loss adjusters, surveyors, and other experts who may be appointed to assess the loss.

Advocates handle the full range of insurance claims: property claims (for damage to buildings, contents, and stock from fire, theft, flood, and other perils); motor vehicle claims (for own damage and third-party claims); liability claims (for personal injury and property damage caused to third parties); business interruption claims (for loss of profits following an insured event); marine claims (for cargo loss and damage, and hull claims); and professional indemnity claims (for claims against professionals for negligent advice or service).

When a claim is declined, they advise on the merits of challenging the declinature. Advocates review the policy wording, the insurer's reasons for declining, and the circumstances of the loss, and they assess whether the declinature is legally justified. Common grounds for declinature include non-disclosure of material facts at the proposal stage, breach of policy conditions, exclusion clauses, and the insured's failure to mitigate the loss. Advocates challenge declinatures that are unjustified — through correspondence, negotiation, and, where necessary, litigation.

For complex claims, they engage and manage expert evidence — including forensic accountants for business interruption claims, engineers for structural damage claims, and medical experts for personal injury claims. Advocates prepare the claim presentation, negotiate with the insurer's loss adjusters and claims handlers, and strive to achieve a fair and timely settlement.

Where settlement cannot be reached, they pursue the claim through the dispute resolution mechanisms available — including mediation, arbitration (where the policy contains an arbitration clause), and litigation before the High Court. Advocates are also experienced in proceedings before the Insurance Appeals Tribunal, which hears appeals from certain decisions of the Insurance Regulatory Authority.

For insurers, they advise on the investigation and assessment of claims, the interpretation of policy wordings, the handling of suspected fraudulent claims, and the management of subrogation recovery actions against third parties. Advocates defend insurers against claims for policy benefits, and they ensure that the insurer's contractual and statutory obligations are met while protecting the insurer from invalid or inflated claims.