Insurance Industry in Rwanda to Widen Its Reach : Ken Research

CIOReview Team | Friday, 10 March 2017, 09:20 IST

Ken Research has announced recent report titled, “Governance, Risk and Compliance - The Rwandan Insurance Industry” which provides detailed analysis of the insurance regulations for life, property, motor, liability, personal accident and health, and marine, aviation and transit insurance and also outlays various requirements for the establishment and operation of insurance and reinsurance companies and intermediaries.

This report includes the details of the rules and regulations governing insurance products and insurance entities as well as lists and analyzes key trends and developments pertaining to the country's insurance regulatory framework.

It provides key performance indicators such as written premium, incurred loss, loss ratio, commissions and expenses, total assets, total investment income and retentions during the review (2011–2015) and forecast (2015–2020) periods. It well details the taxation imposed on insurance products and insurance companies along with information on prevailing insurance regulations, and recent and upcoming changes in the regulatory framework, taxation and legal system in the country. 

It also earns the insights into the insurance regulatory framework in Rwanda and tracks the latest regulatory changes, and expected changes impacting the Rwandan insurance industry.

The Rwandan insurance industry is mainly regulated by the National Bank of Rwanda and has successfully managed to continuously attract new entrants because of its low penetration and growing economy. The unfavorable regulatory framework in Rwanda had earlier restricted demand for insurance by applying 18% VAT to insurance premiums but with the years this VAT has declined to allure more people to get insured.

The Rwanda Revenue Authority had in earlier years raised the taxes to discourage used car imports and reduce carbon emissions to control the circumstances and ultimately it proved to be fruitful for the industry on a whole.

The elderly population of the country is less in comparison to the younger population but it has augmented the awareness of retirement-related life products such as pension, annuity and superannuation insurance over years due to fear of facing the after effects of untimely deaths soon.

The non-life insurance segment of this industry had reckoned for 68.8% of the industry's gross written premium in 2015. Professional indemnity insurance and Motor third-party liability insurance for insurance intermediaries have recently become mandatory in Rwanda in order to safeguard the people from huge losses otherwise in their absence.

National Bank of Rwanda has now even allowed 100% foreign direct investment in the industry that is seen to benefit the industry in the long run with more and more people getting insured and the industry making huge profits.

Though non-admitted and composite insurance both have not been permitted in the Rwandan industry since insurers tend to seek more benefits than they should and over exploit the advantages they get from getting insurance, still the industry is expected to progress at an improving CAGR year after year with evolving demands in the years to proceed.