Kenya's High Court has ordered Kenindia Assurance Company Ltd to pay Mombasa Cement KES1.64bn (US$12.7m) following a 12-year dispute over the collapse of a blending silo.
The court awarded KES664.7m for damage to the silo and KES982.4m for lost profits, together with interest and costs. The dispute concerned the collapse of a silo at Mombasa Cement's plant on 1 August 2011, which formed part of its 3000tpd clinker production facility.
Kenindia had argued that the reinforced-concrete silo constituted civil works rather than machinery covered by the company's insurance policy. However, the court found that the silo was an integral part of the clinker production installation and was expressly identified in the machinery schedule.
The court also rejected the insurer's arguments concerning non-disclosure and underinsurance and accepted loss assessments submitted by Mombasa Cement. Business interruption compensation was limited to the 12-month indemnity period specified in the policy.
