By Spy Uganda
Kampala — A legal dispute over a mortgage and life insurance policy linked to the late sports administrator Cedric Ndilima Babu has drawn national attention, raising broader questions about how protected Ugandan families are when borrowers die before clearing home loans.
Babu, a former sports leader and son of prominent Ugandan figures Olive Zaitun Kigongo and Capt. Francis Babu, died on May 31, 2025 after developing a severe heart condition during a tennis trip to Kigali with his son. His death triggered mourning across the country, with tributes recognising his contribution to sports administration.
Months later, however, his family faces the possible loss of his Kololo home.
In July 2023, Babu secured a $200,000 mortgage from KCB Bank Uganda Limited to purchase a condominium unit on Fumu Lane in Kololo. Like many mortgage facilities in Uganda, the loan required a Group Mortgage Protection Policy, a life insurance cover intended to clear the outstanding loan if the borrower dies.
According to court filings, the outstanding balance now stands at $182,709 (about Shs655 million), plus interest.
The bank maintains that the insurance policy lapsed in August 2024 after renewal premiums were not paid. In its affidavit, KCB argues that responsibility for maintaining the policy rested solely with the borrower and that foreclosure is lawful once a loan falls into default.
Babu’s family disputes that position. They say he met all his obligations and that the bank, which acted as an insurance intermediary by collecting premiums and handling documentation, had authority under the loan agreement to renew the policy at the borrower’s cost if payments were delayed.
The matter is now before the Commercial Division of the High Court.
The dispute intensified after the bank issued a 21-day notice indicating plans to sell the Kololo property unless the outstanding amount is cleared.
For the family, the notice came while they were still grieving.
In a public statement, relatives said Babu had continued servicing his mortgage until his death and that the insurance cover was meant to protect the home in precisely such circumstances.
“We continue to mourn the passing of Cedric… Until his death, he paid all his monthly obligations,” the family said, adding that they turned to court after failing to reach agreement with the bank over insurance coverage.
Beyond one family’s struggle, the case highlights a growing concern in Uganda’s mortgage market, where thousands of home loans are bundled with life insurance policies. Many borrowers assume their families will automatically be protected if tragedy strikes.
Legal analysts say the court’s decision could clarify who bears responsibility when such insurance lapses: the borrower, or the lending bank acting as intermediary.
The outcome may also determine whether families can rely on mortgage protection policies to shield homes from foreclosure after a borrower’s death.
