Fort Magistrate orders trial of foreign broker over contested local tender

Colombo, Feb 26 (Daily Mirror) - The Fort Magistrate’s Court yesterday overruled preliminary objections raised by Tysers Insurance Brokers Limited and fixed a trial date in a case in which Tysers was accused of violating the Regulation of Insurance Industry Act.

Tysers was accused of being granted a tender from the National Insurance Trust Fund (NITF), the local body with which all local insurance companies reinsure their Strike, Riot and Civil Commotion insurance claims.

The foreign insurance broker was awarded the National Insurance Trust Fund reinsurance tender for the year commencing November 1, 2024. The premium to be paid by the NITF for the reinsurance contract was calculated to be close to Rs. 1 billion.

The tender award raised controversy after Tysers Insurance Brokers, through a local company acting as its agent, participated in the bid opening in August 2024. Thereafter, Tysers Insurance was granted the tender for the year 2024/2025.

Strategic Insurance Brokers (Pvt) Ltd, a local insurance broking company, filed action in the District Court and the Magistrate’s Court of Fort challenging the award.

The local insurance brokers argued that the Regulation of Insurance Industry Act prevented entities that were not registered under the Act from participating in any tenders or acting as agents in Sri Lanka.

Tysers Insurance raised an objection to being prosecuted in criminal proceedings, stating that it was permitted to bid for the tender.

However, Fort Magistrate Isuru Neththikumara, in an order delivered yesterday, overruled the objection by Tysers Insurance and held that Section 92 of the Act prevents any person from carrying on business without being duly registered. He fixed the matter for trial on March 25, 2026.

Accordingly, Tysers Insurance is to stand trial for allegedly violating the law and, if found guilty, could be punished with a fine or imprisonment.

Hafeel Farisz, with Shannon Tillekeratne, instructed by Sanduni Rathnayake, appeared for Strategic Insurance Brokers (Pvt) Ltd.

Nalinda Indatissa, PC, with Asith Siriwardena, instructed by F.J. & G. De Saram, appeared for Tysers Insurance Brokers (Pvt) Ltd