Airports authority receives full settlement for JKIA fire

By Winsley Masese and Lonah Kibet

Nairobi, Kenya: Kenya Airports Authority (KAA) has received about Sh1.4 billion from APA Insurance as the final claim following the August 2013 fire tragedy at the Jomo Kenyatta International Airport (JKIA).

This brings the total compensation for the inferno by the insurer, which gutted the airport’s international arrivals terminal to Sh1.97 billion.

APA presented to KAA interim Sh500 million-payout in December 2013 to facilitate reconstruction of the new arrivals terminal at the East and Central Africa’s busiest airport.

Managing Director Lucy Mbugua said the money would significantly boost expansion projects in an effort to make JKIA a key hub in the region. “The full compensation of the claim will enable us to restore the facilities at the airport, which together with the ongoing expansion and modernisation works, will stamp the position of the airport as the gateway into the region,” she said.

Last year, APA Insurance Company paid Sh500 million in its first tranche of the settlement, bringing the total payment to Sh1.97 billion.

Investigations into the incident attributed it to an electrical fault. APA chairman John Simba termed the settlement as a reflection of trust and true partnership between the parties involved. The airport has already put out bids for a contractor to demolish the damaged international arrival section, which was condemned and the exercise is expected to take six months.

Speaking during the presentation of the compensation cheque at KAA head office yesterday, Mr Simba said the payment is a demonstration on the issue of trust between the partners.

Maintaining trust

“What we have settled today is a demonstration of an insurance company keeping part of its promise and maintaining trust,” he said. He said that the payment shows the ability of the industry to settle huge claims besides an indication of the insurer’s ability to settle claims.

The insurance company paid claims amounting to Sh3.9 billion in 2013 and since the start of this year, it has so far settled claims worth Sh2.5 billion.

Swiss Re, Africa Re, Kenya Re Zep Re and East Africa Re met part of the compensation. By receiving financial support from the different reinsurers, Simba underscored the need of spreading risks in an effort to settle part claims. The total claim was arrived at after extensive involvement of the forensic experts, engineers and quantity surveyors.