Insurers want cover for commercial buildings

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  The Grand Pension Plaza, in downtown Kigali. Other projects countrywide are struggling to attract occupants. The New Times/File.
• By Alex Ngarambe

Insurance companies have asked the government to ensure all commercial and administrative buildings are insured to minimize risks.

The idea was mooted at the just-concluded meeting of insurers held in Kigali.

Rwanda’s insurance penetration level stands at a staggering 2.3 percent, which is not impressive, according to the association of insurers in the country.

It is presumed that less than 5 percent of commercial and administrative properties in the country are insured.

The association largely attributes the low level of penetration to lack of professionalism which creates a gap in designing products to put on the market as well as negative attitude towards insurance policies.

 “The insurance penetration level is very low compared to developed countries. We have a long way to go; we have to intensify the awareness campaigns to change people’s perceptions toward insurance,” explained Marc Rugenera, the president Rwanda Insurance Association.

Real estate developers, who talked to The Business Times, welcomed the appeal, saying it would benefit property developers.

Fred Rwihunda, from Rwanda Social Security Board (RSSB), said property insurance benefits asset owners.

“This would mean safety of the property and the compensation process in case the risk occurred would be easier,” said Rwihunda, the director of real estate development unit at RSSB.

Alice Mpinganziza, the Chief Executive Officer of Kigali Real Estate, said some people fear insuring their property but the risk is much greater than insurance premiums.

But Titien Muberangabo, the acting Managing Director of SONARWA, noted that owners of commercial and administrative property should be compelled to insure against risks such as fire.

“The fee is less than Rwf100,000 per year which is not high compared to the risk so property owners should embrace insurance or it should be made mandatory,” added Muberangabo.