…As Other Insurance Giants Face Legal Battle
Botswana’s insurance sector has been rocked after the competition regulator secured a landmark settlement with insurance heavyweight Hollard Insurance Company of Botswana Proprietary Limited, which has agreed to pay a penalty of P4.8 million in a price-fixing and anti-competitive conduct case involving car repairers.
The settlement, confirmed by the Competition and Consumer Tribunal, marks a historic breakthrough for the Competition and Consumer Authority (CCA), becoming the first cartel settlement ever concluded in Botswana.
The Authority said the order brings to an end litigation against Hollard over allegations of anti-competitive behaviour in the motor insurance repair market, while investigations continue against other major players.
On 30 November 2023, the Authority formally referred the case to the Tribunal, implicating Botswana Insurance Company Limited, Hollard, Old Mutual Short-Term Insurance (Botswana) Limited and Parts Portal Proprietary Limited trading as Autoboys Evolve.
The firms were accused of engaging in a web of anti-competitive practices, including direct and indirect price fixing, coordinated terms of trade with car repairers, abuse of dominance, and the exchange of confidential commercial information.
Under the settlement agreement, Hollard has admitted that parts of its past conduct breached competition law, and confirmed it has already ceased the practices. The insurer has also committed to introducing a formal competition law compliance programme, to be submitted to the Authority within 90 days.
According to the Authority’s findings, these practices had the effect of substantially reducing competition in the market, potentially inflating costs and limiting choice for consumers relying on motor insurance services.
While the Tribunal was still seized with the matter, Hollard opted to settle. The Authority’s case against the remaining respondents is ongoing, signalling that the broader industry probe is far from over.
Under the settlement agreement, Hollard has admitted that parts of its past conduct breached competition law, and confirmed it has already ceased the practices. The insurer has also committed to introducing a formal competition law compliance programme, to be submitted to the Authority within 90 days.
In addition, Hollard has agreed to fully cooperate with regulators in the ongoing prosecution of the remaining firms, a move likely to increase pressure on its industry peers.
The company will also pay a financial penalty of P4,828,510.08, bringing closure to its portion of the investigation.
The Authority described the settlement as a major milestone in enforcing competition law in Botswana’s financial services sector, particularly in markets that directly affect consumer pricing and service access.
However, with the wider case still unfolding, the insurance industry is bracing for further revelations as regulators continue to probe what has been described as coordinated anti-competitive behaviour among key market players.
