The national Bank of Rwanda is reviewing a shareholder’s agreement between Swan Insurance, from Mauritius, and BK Insurance that involves acquiring a 30 per cent stake in the Rwandan firm. BK insurance is a subsidiary of BK Group and only joined the market last year. Officials from BK argue that by selling a 30 per cent stake, they will get more capital as well as expertise from a company that has been in business for more than a century. Diane Karusisi the Group’s Chief Executive Officer, said that once the deal is finalised, Rwandans should expect new insurance concepts and practices. “We are awaiting approval by the Central Bank. We do not expect that there will be any challenges,” Karusisi said. Ordinarily, the acquisition of a stake in an insurance operator is subject to regulatory approval by the Central Bank for quality checks. Swan Insurance recently acquired stakes in insurance firms in Zambia and Zimbabwe as it seeks to grow its presence on the continent. BK Insurance estimates that they currently have about 10 per cent market share in Rwanda with the target of 12 per cent by 2020. In the first quarter of this year, BK Insurance reported an increase in profits of Rwf79.9m after underwriting premiums worth about Rwf700m. Fire and motor insurance contributed the most. Among the firm’s competitive advantage in the local market is use of their subsidiary – Bank of Kigali – which has a network of 79 branches country wide. This year, BK Insurance launched a travel insurance product which they hope can further increase their market share. Going forward, the firm is planning to introduce agriculture insurance products for crops and animals which they believe could drive further penetration. Insurance penetration in Rwanda is currently below 4 per cent despite having over 15 players in the sector with experts blaming the low penetration on lack of innovation among players. editorial@newtimes.co.rw
