It is a motorist's worst nightmare. You pay your premiums religiously for years, only to have your claim rejected the moment tragedy strikes. A landmark ruling by the Insurance Regulatory Authority (IRA) appeals tribunal has shed light on a common but overlooked clause that is leaving thousands of Kenyan drivers exposed: "Material Non-Disclosure."

The case involved a Toyota Fielder owner whose vehicle was written off in an accident. The insurer repudiated the KES 1.2 million claim because the driver, though holding a valid license for a motorcycle, did not have a valid license for a light commercial vehicle. Furthermore, investigations revealed the car, insured for "Private Use," was ferrying crates of soda at the time of the crash.

Private vs. Commercial Use

This distinction is the single biggest cause of claim rejection in Kenya today. With the rise of the gig economy, many Kenyans use their personal cars for Uber, Bolt, or side-hustle deliveries. Insurers classify this as "Commercial Use," which attracts higher premiums. If you are on a "Private Domestic" policy and get into an accident while carrying a paying passenger or goods for trade, your policy is effectively void.

• The "Uber" Clause: Most standard comprehensive policies strictly exclude "hire and reward." Ride-hailing drivers must take out PSV Chauffeur Driven insurance to be covered.
• The License Loophole: The tribunal upheld that the driver must be licensed for the specific class of vehicle being driven. A standard Class B license does not cover you to drive a heavy commercial vehicle, and vice versa.

Protect Yourself

"Honesty is the only policy," advises IRA CEO Godfrey Kiptum. "Do not hide the fact that your car does school runs for the neighborhood or carries farm produce on weekends. Pay the extra premium. It is cheaper than replacing a KES 2 million car out of pocket." The ruling sets a precedent that shifts the burden of full disclosure squarely onto the insured.