Police Service Renews Private Insurance Contract Despite Sh834M Debt and Idle Hospital

The National Police Service (NPS) has quietly renewed a lucrative private medical insurance contract with APA Insurance, even as a fully equipped Sh1.23 billion police hospital in Nairobi’s Mbagathi area remains unused and the government owes nearly Sh834 million to its contractor.

According to a memo dated April 11, 2025, issued by Apeles Chacha on behalf of the Nairobi regional police commander, the new one-year medical cover will run from April 1, 2025, to March 31, 2026.

“You are required to inform officers that NPS has renewed the medical insurance contract with APA and a joint venture with effect from April 1, 2025, to March 31, 2026,” reads the memo circulated to all sub-county police commanders in Nairobi, officers in charge of law courts, and depots.

Deputy President Kithure Kindiki and Health CS Aden Duale during the hand over of the National Police Service Hospital Level Four Hospital in Mbagathi, Nairobi on May 17, 2024. (Photo: MINA)

The 150-bed level 4 hospital, built to reduce reliance on expensive private insurance schemes and improve healthcare access for police officers and their families, has been completed since the 2022/2023 financial year but remains non-operational.

The Kenya Defence Forces (KDF), which supervised the construction, has refused to hand over the facility until the full amount is paid, with the government having only remitted Sh400 million so far.

Nancy Gathungu, the Auditor-General, flagged this issue in her 2023/2024 report, stating that “value for money spent on the project has not been realised” due to delayed payments and failure to operationalize the facility.

While the memo doesn’t specify the value of the renewed insurance contract, it indicates that “the benefit cover provided under this renewed contract remains the same,” suggesting it could be comparable to previous arrangements. In 2023, the government paid Sh6.7 billion to the now-defunct National Hospital Insurance Fund (NHIF) for police coverage.

The decision has raised eyebrows among fiscal watchdogs who question the logic of continuing with expensive private insurance while a purpose-built facility remains dormant.

Officers have been instructed to update their beneficiary lists before April 30, 2025, raising concerns that dependents added after this date may not receive coverage under the new policy.

The Auditor-General’s report also highlighted several irregularities in previous insurance arrangements, including 262 unpaid Group Personal Accident claims, 21 delayed Group Life payments worth Sh43.5 million, and 509 uncompensated Work Injury Benefits claims at the time of audit.