Risk assessment to help fix premiums for motorcyclists

Wednesday September 14 2022
Moto premiums

There has been an outcry by motorcyclists over high premiums, which insurance companies attribute to high risks involved. Picture: Cyril Ndegeya

By Ange Iliza

The government is planning to introduce risk assessment system for motorcyclists to calculate insurance premiums, Rwanda Today has learnt.

This comes after widespread outcry by thousands of motorcyclists countrywide. In January, motor taxi operators in Kigali staged protests over high meter charges and insurance premiums hike, saying the cost of doing business has increased due to several expenses including introduction of GPS-enabled fare technology that allows automated computation of traveled distance and fare settlement.

This was again raised during President Paul Kagame’s citizen outreach in Ruhango district. At the meeting, President Kagame tasked officials to resolve the issue, and at the same meeting, the Minister of Infrastructure reassured the motorcyclists that the issue would be resolved within two months.

Now, Rwanda Today has learnt that the government is considering introducing a system that includes an appraisal of a motorcyclist's driving record to help determine the risk that would be used to determine how much insurance premium is charged.

The government hopes this will help to settle the dilemma between insurance companies and motorbikes over high insurance premiums. Motorcyclists say the premiums are unaffordable while insurers say ensuring motorbikes that are involved in 70 percent of road accidents in Rwanda deep them in losses.

Minister for Infrastructure had promised to partner with the central bank and solve the issue in two months, introducing the driving performance evaluation cards is one of the proposed solutions, according to the Minister, Ernest Nsabimana.


The cards would be given to every taxi motorcyclist. They would be used to record and evaluate traffic violations and accidents. The marks would determine how much insurance premiums are to be paid. Motorbikes involved in more traffic violations and accidents would pay higher premiums than others.  This would cut insurance costs and encourage traffic safety.

“This is a widely used method in other countries such as South Africa. It is among many other proposed solutions we believe will solve this issue for once. We are still in the initial stages of gathering the necessary information and proposed solutions,” said Minister Nsabimana.

The process of settling the issue is spearheaded by the Ministry of Infrastructure which regulates the transport sector and the central bank which regulates insurance companies. Both institutions did not provide further details on the process and said the discussions around it are ongoing.

However, officials hope the new scheme will reassure insurance companies who say they incur losses. For instance, Radiant Insurance, in 2020, collected Rwf2.5 billion in motorcycle insurance premiums, but also paid compensation claims of over Rwf4.7 billion in accidents that motorcycles caused, either to the passenger’s or other vehicles, according to Ovia Kamanzi, Deputy Managing Director at Radiant Insuarance.

Insurance premiums increased in 2021 from Rwf61,000 to 66,000 per year to Rwf161,000 and Rwf166,000 depending on how old the taxi moto is. The increase was followed by a rise in fuel prices. The decisions affected over 220,000 registered motorcycles in Rwanda, 30,000 of which operate in Kigali.

After the raise, the number of taxis motors that are fined by the Rwanda National Police for operating without insurance increased from 3,433 in 2020 to 4,111 taxi motos in 2021, according to numbers from traffic police. A taxi motorcyclist is fined Rwf25,000 and is held until insurance premium errands are cleared or it gets auctioned.

Taxi motor operators staged protests in January this year over high fare meter charges and insurance premiums hike, saying this has caused business losses. The issue was raised again during the Citizen Outreach Program when President Kagame visited Ruhango district last month.

“...The cost has risen so high we can hardly make any profit. We would like for the cost to be reduced,” said Piere Hakorimana, a motorcyclist.